Jam Life Inc

Essay

Jam Life Inc. manufactures jam products. It makes a mixed fruit and berry jam by blending strawberries, peaches, and apricots.
Budgeted costs to produce 100,000 kilograms of jam in September were:

Actual costs to produce 100,000 kilograms of jam in September were:

Required:
1. Calculate the total direct materials rate and efficiency variances.
2. Calculate the total direct materials mix and yield variances.
3. Jam Life's largest competitor sells a 500 gram jar of mixed fruit and berry jam for $4.50 . If Jam Life's management wants to meet this price and cover monthly fixed costs of $180,000 then what will be the company's margin of safety? (Assume that Jam Life will continue to use the budgeted mix of ingredients.)