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Budgeted Income Statement

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Using the attached excel worksheet (attached), Budgeted Income Statement and data below:

Data:

Use the following data to analyze the Budgeted Income Statement's Cost of Goods Sold (assume 40% of the COGS total amount is from direct material costs and 40% is from direct labor costs. The other 20% is from manufacturing overhead):

- Budgeted Production Volume for the first quarter of 2010 = 150,000 units (standard quantity) (assume all units were sold)

- Budgeted Production Volume is recorded based on Standard Per Unit Cost

- Assume Actual Production Volume for the first quarter in 2010 = 200,000 units

- Assume Actual Cost of Goods Sold (COGS) for the first quarter in 2010 = \$1,100,000 (40% direct material, 40% direct labor, 20% manufacturing overhead)

1. Using the information above, calculate the Direct Material Price and Quantity Variances. 2. Are they favorable of unfavorable?

3. Using the information above, calculate the Direct Labor Rate and Efficiency Variances, and Direct Labor Variance. 4. Are they favorable of unfavorable?

5. Discuss how Kaizen Costing and Balance Scorecard tools could be used to better BFBS's performance.

6 Discuss an analysis of the numerical data. 7. Discuss the strengths and/or weaknesses of the BFBS variance analyses. 8. Evaluate the data, discuss your recommendations?

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