Question

Gleason Guitars produces acoustic guitars. The table below contains budget and actual information for the month of June: (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)

	Actual Costs 245 units Spending Variance Flexible Budget 245 units Volume Variance Master Budget 200 units Direct Material $15,700 $14,200 Direct Labor 26,400 22,200 Variable Overhead 8,450 8,200 Fixed Overhead 11,700 11,100 Total Manufacturing Costs $62,250 $55,700

Answer 1

	Actual Costs 245 units	Spending Variance		Flexible Budget 245 units	Volume Variance		Master Budget 200 units
	(1)	2 = (3 - 1)		(3)	4 = (3 -5)		(5)
Direct Material	15,700	1,695	F	17,395	3,195	U	14,200
Direct Labor	26,400	795	F	27,195	4,995	U	22,200
Variable Overhead	8,450	1,595	F	10,045	1,845	U	8,200
Fixed Overhead	11,700	600	U	11,100	-		11,100
Total Manufacturing Costs	62,250	3,485	F	68,233	12,533	U	55,700