The Becton Enterprises (BE) produces a gasoline additive, Charger Power. This product increases engine efficiency and improves gasoline mileage by creating a more complete burn in the combustion process. Careful controls are required during the production process to ensure that the proper mix of input chemicals is achieved and that evaporation is controlled. Loss of output and efficiency may result if the controls are not effective. The standard cost of producing a 500-liter batch of Charger Power is $135. The standard materials mix and related standard cost of each chemical used in a 500-liter batch are: Std input Chemical quantity Echol 200 Protex 100 Benz 250 CT-40 50 600 The quantities of chemicals purchased and used during the current production period are shown in the schedule below. A total of 149 batches of Charger Power were manufactured during the current production period. The controller of BE has determined its costs and chemical usage variations at the end of the production period. Quantity Total Chemical Purchased Cost Echol Protex Benz CT-40 O What is the total material yield variance? Multiple Choice OOO Quantity Used 28,000 14,280 40,200 5,975 39,200 7,700 2,355 8,540 86,300 90,020 25,200 $5,500 13,200 6,375 Std cost per liter $0.200 0.425 0.150 0.300 $429.50. $139.50. $568.50. Total cost $ 40.00 42.50 37.50 15.00 $135.00 $415.00
The Becton Enterprises (BE) produces a gasoline additive, Charger Power. This product increases engine efficiency and improves gasoline mileage by creating a more complete burn in the combustion process. Careful controls are required during the production process to ensure that the proper mix of input chemicals is achieved and that evaporation is controlled. Loss of output and efficiency may result if the controls are not effective. The standard cost of producing a 500-liter batch of Charger Power is $135. The standard materials mix and related standard cost of each chemical used in a 500-liter batch are: Std input Chemical quantity Echol 200 Protex 100 Benz 250 CT-40 50 600 The quantities of chemicals purchased and used during the current production period are shown in the schedule below. A total of 149 batches of Charger Power were manufactured during the current production period. The controller of BE has determined its costs and chemical usage variations at the end of the production period. Quantity Total Chemical Purchased Cost Echol Protex Benz CT-40 O What is the total material yield variance? Multiple Choice OOO Quantity Used 28,000 14,280 40,200 5,975 39,200 7,700 2,355 8,540 86,300 90,020 25,200 $5,500 13,200 6,375 Std cost per liter $0.200 0.425 0.150 0.300 $429.50. $139.50. $568.50. Total cost $ 40.00 42.50 37.50 15.00 $135.00 $415.00
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter14: Quality And Environmental Cost Management
Section: Chapter Questions
Problem 23E: Coyle Pharmaceuticals produces two organic chemicals (Org AB and Org XY) used in the production of...
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