Walton Fruit Drink Company planned to make 209,000 containers of apple juice. It

Question

Walton Fruit Drink Company planned to make 209,000 containers of apple juice. It expected to use two cups of frozen apple concentrate to make each container of juice, thus using 418,000 cups of frozen concentrate. The standard price of one cup of apple concentrate is $0.26. Walton actually pald $119,364 to purchase 426,300 cups of concentrate, which was used to make 210,000 containers of apple juice. b. Compute the actual price per cup of concentrate. (Round your answer to 2 decimal places) c Compute the standard quantity (number of cups of concentrate) required to produce the containers. d. Compute the materials price variance and indicate whether it is favorable (F) or unfavorable (U) (Select "None" if there is no effect (i.e., zero veriance). Round "Price veriance" to 2 decimal places.) e. Compute the materials usage variance and indicate whether it is favorable (F) or unfavorable (U). (Select "None" if there is no effect (Le, zero variance). Round "Usage variance" to 2 decimal places.) b Actual price c Standard quantity per cup

Explanation / Answer

b) Actual price per cup = 119364/426300 = 0.28 per cup

c) Standard quantity = 210000*2 = 420000 Cups

d) Total price variance = (0.26-0.28)*426300 = 8526 U

e) Total quantity variance = (420000-426300)*0.26 = 1638 U

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