Danshui Sheet2

Topics: Order theory, Expected value Pages: 15 (421 words) Published: April 19, 2015
BREAK
 EVEN
 POINT
 ANALYSIS
Production
 Units

200

Revenue
Variable
 cost
Fixed
 cost

$41,240
$40,411
729

Price
 per
 unit:
 (Revenue/Unit)
Variable
 cost
 per
 unit
 (Variable
 
cost/unit)
Contribution
 Margin
 (Price
 per
 
unit-­‐variable
 cost
 per
 unit)

$206.20

Break
 Even
 Point=
 (Fixed
 
cost/Contribution
 margin)
 or
 
729/4.145

$202.06
$4.15

175.875
 units

TOTAL
 COST
 VARIANCE
 
ANALYSIS
Total
 costs
Budget
 Production
 Unit
Expected
 cost
 per
 unit

$41,140,000
200,000
$205.70

Actual
 total
 cost
Actual
 production
 unit
Actual
 cost
 per
 unit

$38,148,000
180,000
211.91

FLASH
 MEMORY
 VARIANCE
 
ANALYSIS

Direct
 Material
 Price
 Varience
(Actual
 Price-­‐Standard
 Price)
 x
 
Actual
 Quantity
($29.16-­‐$27)
 x180,000
$388,800
 U

DIRECT
 MATERIAL
 QUANTITY
 
VARIANCE
(Actual
 Quantity-­‐Standard
 
Quantity)
 x
 Actual
 Price
(180,000-­‐200,000)
 x
 $29.16
$540,000
 F

TOTAL
 MATERIAL
 VARIANCE
(Price
 Variance-­‐Usage
 Variance)

$388,800
 U-­‐$540,000
 F
$151,200
 F

LABOR
 VARIANCE
 ANALYSIS
DIRECT
 LABOR
 RATE
 VARIANCE
(Actual
 Rate-­‐Standard
 Rate)
 x
 
Actual
 Hour
 (production)
($17.18-­‐$13.11)
 x
 180,000
$732,600

DIRECT
 LABOR
 EFFICIENCY
 
VARIANCE
(Actual
 Hour-­‐Standard
 Hour)
 x
 
Standard
 Rate
(180,000-­‐200,000)
 x
 $13.11
$262,200
 F
TOTAL
 LABOR
 VARIANCE
(Labor
 Variance-­‐Efficiency
 
Variance)
$732,600
 U
 -­‐
 $262,200
 F
$470,400
 U
FIXED
 OVER
 HEAD
 SPENDING
 
VARIANCE
(Actual
 Fixed
 Manufacturing
 
Overhead-­‐Standard
 Fixed
 
Manufacturing
 Overhead)
$736,000-­‐$729,000
$7,000
 U

Preliminary
 Report
 August
 
Operations

Revenue
 (transfer
 from
 
Shenzhen)
Variable
 cost
Materials
Flash
 memory
Application
 process
Chips-­‐phone
Gyroscope
8
 other
 chips
Variable
 supplies
 and
 
tools
Subtotal
Labor
Assembly
 and
 
Packaging
Shipping
Total
 Variable
 costs
Fixed
 costs
Factory
 Rent
Machine
 
Depreciation
Utility
 fee
 and
 
taxes
Supervision
Total
 fixed
 costs
Total
 costs
Net
 income

Alternatives
Outsource
Increase
 factory
 
wages
Overtime
 schedule
Pay
 for
 performance
 
policy
Training
Cellular
 
manufacturing

Recommendation:
Overtime
 schedule
 
plan
 and
 pay
 for
 
performance
 
Most
 cost
 effective
 
way
 to
 bosst
 up
 
production
 under
 
same
 capacity
Motivate
 employees
 
morale
 and
 welfare
Achieve
 learning
 
curve
 effect
 under
 
well
 organized
 OT
 
plan

Monthly
 
Budget

Actual
 Budget

Variance

180,000
 units

180,000
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