Reference no: EM133045461

Question - The company 'DrinkMoreCoffee' (DMC) manufactures and sells premium coffee mugs. DMC has budgeted for production and sales of 84,600 units at a price of $120 per unit for 2019. The budgeted variable manufacturing overhead costs are $169,200 and budgeted fixed manufacturing overhead costs are $507,600. DMC selects machine-hours as the cost allocation base and estimates that 2 machine hours are required per output unit. The budgeted direct materials cost per unit is $24.

Actual sales for the period were 82,400 units at $110 per unit. DMC needed 1,5 machine hours per output unit and incurred variable manufacturing overhead costs totaling $164,100 and fixed manufacturing overhead costs of $500,000. The actual cost for direct materials used was $28.

a) What is the budgeted number of machine hours planned?

b) What is the actual number of machine hours used?

c) What is the flexible-budget sales amount (revenues) for the period?

d) What is the budgeted variable manufacturing overhead cost rate per output unit?

e) What are the budgeted fixed manufacturing overhead costs per machine hour?

f) What are the variable manufacturing overhead price and efficiency variances for the current period? Mark variances as either favorable (F) or unfavorable (U).