The following data are available for the most recent year of operations for Slacker & Sons. The revenue portion of the sales activity variance is $288,000 F. Master budget based on actual sales of 161,000 units: Revenue $ 3,600,000 Materials 861,000 Labor 636,000 Variable manufacturing overhead and administrative costs 136,000 Fixed manufacturing overhead and administrative costs 410,000 Required: a. How many units were actually sold in the most recent period? b. Prepare a sales activity variance for the most recent year for Slacker & Sons.
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
The following data are available for the most recent year of operations for Slacker & Sons. The revenue portion of the sales activity variance is $288,000 F.
| Revenue | $ | 3,600,000 | |
| Materials | 861,000 | ||
| Labor | 636,000 | ||
| Variable manufacturing |
136,000 | ||
| Fixed manufacturing overhead and administrative costs | 410,000 | ||
Required:
a. How many units were actually sold in the most recent period?
b. Prepare a sales activity variance for the most recent year for Slacker & Sons.
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