2. Creating a budget performance report Country Toppers produces cowboy hats of
ID: 2444466 • Letter: 2
Question
2. Creating a budget performance report
Country Toppers produces cowboy hats of various designs. The Stetson cattleman hat is the company's most popular design, and the company ordinarily sells almost 5,900 of these hats during March. The following table provides the standard cost per unit for Country Toppers's Stetson hat:
In March 2013, Country Toopers had the following actual results:
A. Complete the following budget performance report for Country Toppers based on the preceding information:
Country Toppers Budget Performance Report For the Month Ended Mar. 31,2013
Standard Cost at Actual Volume
(5,600 hats)
Cost Variance-
(Favorable) Unfavorable
Manufacturing Costs Standard Price x Standard Quantity Per Hat = Standard Cost Per Hat Direct materials $42 per sq.yd. x 1.2 sq.yd. = $50.40 Direct labor $16 per hr. x 4.5 hrs. = 72.00 Factory overhead $16 per hr. x 4.5 hrs. = 72.00 Total standard cost per hat $194.40Explanation / Answer
Manufacturing Costs Actual Costs Standard Cost at Actual Volume Cost Variance- Favourable / (Unfavourable) Direct materials 305760 282240 -23520 Unfavourable Direct labor 412300 403200 -9100 Unfavourable Factory overhead 441000 403200 -37800 Unfavourable Total manufacturing costs 1159060 1088640 -70420 Unfavourable
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