Note: This section is a continuation from Parts A and B of the comprehensive problem. Be sure you have completed Parts A and B before attempting Part C. You may have to refer back to data presented in Parts A and B as well as use answers from those parts when completing this section. Genuine Spice Inc. began operations on January 1 of the current year. The company produces 8-ounce bottles of hand and body lotion called Eternal Beauty. The lotion is sold wholesale in 12-bottle cases for $100 per case. There is a selling commission of $20 per case. The January direct materials, direct labor, and factory overhead costs are as follows:

DIRECT MATERIALS
Cost
BehaviorUnits
per CaseCost
per UnitDirect Materials
Cost per Case
Cream baseVariable100 ozs.$0.02 $2.00
Natural oilsVariable30 ozs.0.30 9.00
Bottle (8-oz.)Variable12 bottles0.50 6.00
$17.00
DIRECT LABOR
DepartmentCost
BehaviorTime
per CaseLabor Rate
per HourDirect Labor
Cost per Case
MixingVariable 20min.$18.00 $6.00
FillingVariable 5 14.40 1.20
25min. $7.20
FACTORY OVERHEAD
Cost BehaviorTotal Cost
UtilitiesMixed $600
Facility leaseFixed 14,000
Equipment depreciationFixed 4,300
SuppliesFixed 660
$19,560
Part C—August Variance Analysis

During September of the current year, the controller was asked to perform variance analyses for August. The January operating data provided the standard prices, rates, times, and quantities per case. There were 1,500 actual cases produced during August, which was 250 more cases than planned at the beginning of the month. Actual data for August were as follows:

Actual Direct Materials
Price per UnitActual Direct Materials
Quantity per Case
Cream base$0.016per oz.102ozs.
Natural oils$0.32per oz.31ozs.
Bottle (8-oz.)$0.42per bottle12.5bottles
Actual Direct Labor
RateActual Direct Labor
Time per Case
Mixing$18.2019.50 min.
Filling14.005.60 min.
Actual variable overhead$305.00
Normal volume1,600 cases
The prices of the materials were different than standard due to fluctuations in market prices. The standard quantity of materials used per case was an ideal standard. The Mixing Department used a higher grade labor classification during the month, thus causing the actual labor rate to exceed standard. The Filling Department used a lower grade labor classification during the month, thus causing the actual labor rate to be less than standard.

Required:

10. Determine the direct materials price and quantity variances for the three materials. Enter the costs in dollars and cents (carried to three decimal places when required). Enter all amounts as positive numbers.

Direct Materials Price Variance:
Cream Base Natural Oils Bottles
Actual price$ $ $
Standard price
Difference$ $ $
Actual quantity (units)Xozs. Xozs. Xbtls.
Direct materials price variance$ $ $
Indicate if favorable or unfavorableFavorable Unfavorable Favorable
Enter the standard price to two decimal places.

Direct Materials Quantity Variance:
Cream BaseNatural OilsBottles
Actual quantity ozs. ozs. btls.
Standard quantity
Difference ozs. ozs. btls.
Standard priceX X X
Direct materials quantity variance$ $ $
Indicate if favorable or unfavorable
11. Determine the direct labor rate and time variances for the two departments. Do not round hours. Enter the costs in dollars and cents. Enter all amounts as positive numbers.

Direct Labor Rate Variance:
Mixing DepartmentFilling Department
Actual rate$ $
Standard rate
Difference$ $
Actual time (hours)X X
Direct labor rate variance$ $
Indicate if favorable or unfavorableUnfavorable Favorable
Direct Labor Time Variance:
Mixing DepartmentFilling Department
Actual time (hours)
Standard time (hours)
Difference
Standard rateX $ X $
Direct labor time variance$ $
Indicate if favorable or unfavorableFavorable Unfavorable
12. Determine the factory overhead controllable variance. Enter all amounts as positive numbers.

Actual variable overhead$
Variable overhead at standard cost
Factory overhead controllable variance$
Indicate if favorable or unfavorableUnfavorable
13. Determine the factory overhead volume variance. Round rate to two decimal places and round your final answer to two decimal places. Enter all amounts as positive numbers.

Normal volume (cases)
Actual volume (cases)
Difference
Fixed factory overhead rate$
Factory overhead volume variance$
Indicate if favorable or unfavorableUnfavorable
14. The production volume of cases was planned at the beginning of August. The variances compare the actual cost and the standard cost of actual production for the month. Thus, the standard cost must be based on the units of actual production.