Lloyd Publications established the following standard price and costs for a hard

Question

Lloyd Publications established the following standard price and costs for a hardcover picture book that the company produces. Standard price and variable costs Sales price $ 45.00 Materials cost 9.00 Labor cost 4.50 Overhead cost 6.30 Selling, general, and administrative costs 7.20 Planned fixed costs Manufacturing overhead $ 135,000 Selling, general, and administrative 54,000 Assume that Lloyd actually produced and sold 32,000 books. The actual sales price and costs incurred follow. Actual price and variable costs Sales price $ 43.50 Materials cost 9.20 Labor cost 4.40 Overhead cost 6.35 Selling, general, and administrative costs 7.00 Actual fixed costs Manufacturing overhead $ 125,000 Selling, general, and administrative 58,000

Explanation / Answer

Flexible Actual Effect sales 1440000       [45*32000] 1392000    [43.5*32000] 48000 U Less:variable cost Material cost 288000 294400 6400 U Labor 144000 140800 3200 F Overhead 201600 203200 1600 U selling and administration 230400 224000 6400 F Total vatiable cost 864000 862400 1600 F contribution 576000 529600 46400 U Less:fixed cost Manufactuing 135000 125000 10000 F Selli ng 54000 58000 4000 U Income 387000 346600 40400 u

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