Course ACCY 302 Activity Individual Case 2 Case Danshui Plan

Course ACCY 302 Activity Individual Case 2 Case Danshui Plant No. 2 Exhibit 1 Standard Variable Costs for iPhone 4 (U.S. Dollars) 9 Bill of materials (per unit) 10 Purchased chips 12 13 14 15 16 17 Flash memory (Samsung) Application processor (Samsung) Chip for phone calls (Infinion) Gyroscope (STMMicroelectronics) 8 other purchased chips Variable supplies and tools 18 19 Labor 20 Assembly and packaging (per unit) 21 Shipping (per unit) 23 24 25 26 27 28 29Monthly fixed costs Exhibit 2 Budgeted Fixed Overhead per Month Factory rent Machine depreciation Utility fee and local taxes Supervision 30

Solution

Rate Per Unit Original Budget 200,000 Units Actual - 180,000 Units Variance - 20,000 Units Flexible Budget - 180,000 Units Actual - 180,000 Units Variance Revenue      206.20    41,240,000.00    37,476,000.00    3,764,000.00 (U)    37,116,000.00    37,476,000.00        360,000.00 (F) Variable Costs: Materials Flash Memory (Samsung)         27.00      5,400,000.00      5,249,000.00        151,000.00 (F)      4,860,000.00      5,249,000.00        389,000.00 (U) Application Processor (Samsung)         10.75      2,150,000.00      1,935,000.00        215,000.00 (F)      1,935,000.00      1,935,000.00                         -   Chip for Phone Calls (Infinion)         14.05      2,810,000.00      2,529,000.00        281,000.00 (F)      2,529,000.00      2,529,000.00                         -   Gyroscope (STMMicroelectronics)           2.60          520,000.00          468,000.00          52,000.00 (F)          468,000.00          468,000.00                         -   8 Other purchased Chips         70.95    14,190,000.00    12,643,000.00    1,547,000.00 (F)    12,771,000.00    12,643,000.00        128,000.00 (F) Variable Supplies & Tools         62.54    12,507,000.00    11,305,000.00    1,202,000.00 (F)    11,256,300.00    11,305,000.00          48,700.00 (U) Sub-Total      187.89    37,577,000.00    34,129,000.00    3,448,000.00 (F)    33,819,300.00    34,129,000.00        309,700.00 (U) Labor: Assembly and Packing         13.11      2,622,000.00      3,092,000.00        470,000.00 (U)      2,359,800.00      3,092,000.00        732,200.00 (U) Shipping           1.06          212,000.00          191,000.00          21,000.00 (F)          190,800.00          191,000.00                200.00 (U) Total Variable Costs      202.06    40,411,000.00    37,412,000.00    2,999,000.00 (F)    36,369,900.00    37,412,000.00    1,042,100.00 (U) Fixed Costs: Factory Rent          400,000.00          400,000.00                         -            400,000.00          400,000.00                         -   Machine Depreciation          150,000.00          150,000.00                         -            150,000.00          150,000.00                         -   Utility Fees and Local Taxes            52,000.00            52,000.00                         -              52,000.00            52,000.00                         -   Supervision          127,000.00          134,000.00            7,000.00 (U)          127,000.00          134,000.00            7,000.00 (U) Total Fixed Costs          729,000.00          736,000.00            7,000.00 (U)          729,000.00          736,000.00            7,000.00 (U) Total Costs    41,140,000.00    38,148,000.00    2,992,000.00 (F)    37,098,900.00    38,148,000.00    1,049,100.00 (U) Net Income          100,000.00        (672,000.00)        772,000.00 (U)            17,100.00        (672,000.00)        689,100.00 (U)