The Standards for One Carton of Flavor Rite Are

question 14

Essay

The standards for one carton of Flavor Rite are:
During the week ended May 17, the following activity took place:
• 4,800 lbs. of raw material were purchased for inventory at a cost of $5.60 per pound;
• 1,200 cartons of finished product were produced;
• 4,020 lbs. of raw material were used;
• 3,110 labor hours were worked at a total cost of $26,435.Calculate each of the following variances:
(a.) Raw materials purchase price variance.(b.) Raw materials usage variance.(c.) Direct labor rate variance.(d.) Direct labor efficiency variance.(e.) Explain the factors that most likely caused the variances computed above.

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Definitions:

Restructured Loan

A loan that has had its terms modified by agreement between the borrower and lender, often to provide relief to a borrower from the original terms due to financial difficulty.

Discount Future Cash Flows

The process of determining the present value of a series of future cash flows by applying a discount rate, reflecting the time value of money.

Original Contract Rate

This term refers to the initial interest rate agreed upon in a financial contract, such as a loan or lease agreement.

Restructured Loan

A loan for which the terms have been modified due to the borrower's inability to meet the original terms, often involving a reduction in the interest rate or an extension of the payment period.