Reference no: EM13913398
Orchid Ltd. is a small furniture manufacturer. It was established as a family-owned business 30 years ago and prides itself on high-quality products. Most of its products are made to order as a result of direct orders from Internet-based sales. Typically the company has been profitable, operating at the top end of the market; recently, however, costs appear to have been increasing and the company has also seen a decline in its sales. The workforce is highly skilled and recently several of the experienced craftspeople who make the products have retired, and the company has had problems recruiting, training and retaining suitably skilled employees. One of its products, a table, has the following standard costs:
|
|
£
|
|
Direct materials (8m @ £30/m)
|
240.00
|
|
Direct labour (10 hours @ £25/hr)
|
250.00
|
|
Fixed overheads
|
160.00
|
|
|
650.00
|
|
Selling price
|
950.00
|
|
Standard profit margin
|
300.00
|
The table is made from solid oak and the above materials reflect the size of the table in square metres. The labour required to make the table is highly skilled.
The monthly production and sales are planned to be 800 units. The actual results for March were as follows:
|
|
£
|
|
|
Sales revenue
|
753,300
|
|
|
Less
|
|
|
|
|
Direct materials
|
(192,500)
|
(7,000m)
|
|
Direct labour
|
(221,000)
|
(8500 hours)
|
|
Fixed overheads
|
(130,000)
|
|
|
Operating profit
|
209,800
|
|
There were no opening or closing stocks. The company manufactured and sold 810 tables; this is more than budgeted due to a successful marketing campaign.
Required
1. Calculate the flexed and actual budget.
2. Calculate the following variances:
o Sales variances; volume and price
o Direct material variances; usage and price
o Direct labour variances; efficiency and rate
o Fixed overhead variance; spending
Give possible explanations for the variances that you have calculated and suggestions as to how the company might try to improve its cost control.
|
Indicate given statements is more applicable to an inventory
: Indicate whether each of the statements that follow is more applicable to a perpetual inventory system, periodic inventory system, or both. Inventory figure is not accurate until the balance sheet date.
|
|
Calculate its horizontal range
: A projectile is fired from ground level with a velocity of 500 m/s at 30° to the horizontal. Calculate its horizontal range, the greatest height it reaches, and the time taken to rise to that height.
|
|
Break-even financially
: They expect to have 800 patients per year with the van. It will cost $3000 per year to maintain the vehicle, which includes all relevant costs. How much will the WCHC need in foundation grants this year to make the purchase break-even financially
|
|
Calculate the mass of the object
: An object which at rest at a height 10m above the ground, falls on the ground and penetrates 25 cm in to the ground. If the ground resistance four is 1kN, calculate the mass of the object.
|
|
Calculate the flexed and actual budget
: Calculate the flexed and actual budget. Calculate the following variances:- Sales variances; volume and price, Direct material variances; usage and price
|
|
Objectives to enhance border and transportation security
: The national strategy identified several objectives to enhance border and transportation security, the strategy included
|
|
Object on the ground
: An object of mass 10 kg falling from a height of 20 m on to a hard floor rebounds to a height of 5m. If the time during which the object was in intact with the ground is 0.004s what was the force exported by the object on the ground?
|
|
Debt will be used to repurchase shares of outstanding stock
: U-Meyer and Associates, an online options broker, is an all equity firm with 60,000 shares of stock outstanding at a market price of $50 a share. The company has earnings before interest and taxes of $87,000. U-Meyer and Associates has decided to iss..
|
|
If the unit selling price goes up then
: If the unit selling price goes up, then
|