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Genie in a Bottle Company (GBC) manufactures plastic two-liter bottles for the beverage industry. The cost Performance goals, often relating to how much a product should cost.standards per 100 two-liter bottles are as follows:
Cost CategoryStandard Cost
per 100 Two-Liter
BottlesDirect labor $1.54 Direct materials 5.9 Factory overhead0.28 Total $7.72
At the beginning of July, GBC management planned to produce 490,000 bottles. The actual number of bottles produced for July was 529,200 bottles. The actual costs for July of the current year were as follows:
Cost CategoryActual Cost for the
Month Ended July 31Direct labor $7,987 Direct materials 30,473 Factory overhead 1,497 Total $39,957
Enter all amounts as positive numbers.
a. Prepare the July manufacturing A detailed estimate of what a product should cost.standard cost budget (direct labor, direct materials, and factory overhead) for WBC, assuming planned production.
Genie in a Bottle CompanyManufacturing Cost BudgetFor the Month Ended March 31Standard Cost at
Planned Volume
(490,000 Bottles)Manufacturing costs:Direct labor$Direct materialsFactory overheadTotal$
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b. Prepare a budget performance report for manufacturing costs, showing the total The difference between actual cost and the flexible budget at actual volumes.cost variances for direct materials, direct labor, and factory overhead for July. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Round your answers to two decimal places.
Genie in a Bottle CompanyManufacturing Costs-Budget Performance ReportFor the Month Ended March 31
Actual
CostsStandard Cost
at Actual
Volume (529,200
Bottles)Cost
Variance-
(Favorable)
UnfavorableManufacturing costs:Direct labor$$$Direct materialsFactory overheadTotal manufacturing cost$$$
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c. The Company’s actual costs were $897.24
factory overhead cost variance.
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