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Question - Sunshine Foods manufactures pumpkin scones and plans to sell them in 2019 for $3 a- piece. For January, Sunshine budgeted sales of 59,000 pumpkin scones. It budgeted to purchase and use 0.25 pounds of pumpkin per scone (14,750 pounds total) at $0.92 a pound.
Actual output was 59,200 pumpkin scones. The scones actually sold for $2.70 a-piece. Actual purchases and usage for January 2019 were 15,000 pounds at $0.89 a pound.
1. Calculate the static-budget variance for revenue and direct material (pounds of pumpkin).
2. Break down each static-budget variance into a flexible-budget variance and a sales- volume variance.
3. Calculate the selling-price variance.
4. Compute the price and efficiency variances for direct material.
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