Prepare the first quarter variance analysis report

Assignment Help Financial Accounting

Reference no: EM132971855

Budgets

Space Ltd makes and sells a single packing product. Annual sales in units for 2021 are expected to be 210,000, and standard cost and selling price per unit is:

Selling price 30

Variable costs:

Materials 8

Labour 8

Overheads 2

Annual fixed overheads for 2021 are budgeted at:

Manufacturing: 528,000

Non-manufacturing 336,000

Actual production and sales for the first quarter was 48,000 units. The actual revenue and expenditure for the quarter was as follows:

Sales revenue 1,506,000

Expenditure:

Materials 355,500

Labour 376,500

Variable overhead 97,200

Fixed overheads

Manufacturing 120,000

Non-manufacturing 105,000

Space Ltd divides the annual budget by 4 in order to produce quarterly variance analysis reports.

Required:

a) Prepare the first quarter variance analysis report showing the fixed budget, flexible budget and flexible budget variances.

Reference no: EM132971855

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