Moozi Dairy Products Processes and Sells Two Products: Milk and Butter

question 310

Essay

Moozi Dairy Products processes and sells two products: milk and butter. Last year, Moozi budgeted $1,200,000 of fixed manufacturing overhead and chose a denominator level of activity of 80,000 machine-hours. Each unit of milk at Moozi has a standard of 0.1 machine-hours and each unit of butter has a standard of 0.08 machine-hours. Last year, Moozi processed 560,000 units of milk and 340,000 units of butter. Moozi's total fixed manufacturing overhead incurred last year was $1,256,000. Actual machine-hours incurred for the year were 82,000. Moozi applies manufacturing overhead to its products on the basis of standard machine-hours.
Required:
Compute Moozi's fixed manufacturing overhead variances for last year.

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Definitions:

Conditioned Reinforcer

Any stimulus that is not originally reinforcing but that acquires reinforcing power through association with a stimulus that is reinforcing, such as money.

Conditioned Reinforcer

A stimulus that gains its reinforcing power through association with a primary reinforcer and is used to reinforce behaviors not naturally related to it.

Novelty

The state or quality of being new, original, or unusual, often stimulating interest or attention.

Positive Reinforcement

A method in behavioral psychology where the probability of a behavior increasing is enhanced by rewarding a positive outcome immediately following that behavior.