Instructions
The instructions for submitting are as follows:
- Where applicable, please enter in the requested amounts in U.S. dollars. (Note that in the case, Exhibit 3 presents revenues and costs in thousands of dollars.)
- Feel free to round to the nearest dollar. Enter your answer in dollar amounts, not in thousands of dollars. For example, if your answer is $76,345 dollars, enter it as 76345 instead of 76.
- Note that there may be rounding differences that have occurred; we're not going to make a big deal about that. The quiz is set up to allow for a range of answers to be accepted as correct.
- You will also upload your spreadsheet file and enter short statements for Question 15(a) and 15(b) as well.
- Important: it is not acceptable to enter the words "see spreadsheet" in place of the requested answers.
- After each submission, you will receive feedback on whether your answer is correct or not for the quantitative questions (but not for the qualitative questions).
- You are allowed unlimited attempts before the deadline. The latest attempt will be recorded.
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Academic integrity and honesty are essential and non-negotiable at the University of Illinois. It is your duty to not only understand and abide by University guidelines (read Article I, Part 4: Academic Integrity of the Illinois Student Code), but also to promote a culture of ethical behavior within your group and class. Ignorance is not an excuse for any academic dishonesty. Violations will be handled via Department, School, and University policies.
Next Steps
If there are more items to be viewed or completed in this module, you can track them below.
- Module 7 Overview
- Case Analysis #2 (Danshui Plant No. 2) Instructions
- Case Analysis #2 (Danshui Plant No. 2), Quiz
- Assignment 9, Quiz
- Live Session #7 Slides and Two Research Papers
Flag question: Question 1Question 11 pts
Using the standard variable cost data from Exhibit 1, compute the total variable cost per unit of Apple iPhone 4. The variable cost should include all materials, labor and shipping costs.
Enter the total variable cost per unit here. Please round the number to two decimal places. Enter a number without the dollar sign $.
Flag question: Question 2Question 22 pts
Using the static budget data from Exhibit 3, compute the budgeted price per unit of Apple iPhone 4. (Hint: budgeted price per unit = budgeted Revenue/total budgeted units)
Enter the price per unit here. Please round the number to two decimal places. Enter a number without the dollar sign $.
Flag question: Question 3Question 32 pts
Based on your answers from Question 1 and 2, compute the contribution margin per unit.
Enter the contribution margin per unit here. Please round the number to two decimal places.
Enter a number without the dollar sign $.
Flag question: Question 4Question 42 pts
Based on your answer from Question 3 and the information from Exhibit 2, compute the numbers of Apple iPhone 4 that would have to be completed in order for Danshui Plant No. 2 to breakeven.
Enter your breakeven units here. Enter it as a whole number, without any comma or any words.
Note: For breakeven units, the norm is to always round it up to the whole number. For example, if your answer is 174658.34, you will enter 174659. Because with 174658 units, the company is still not breakeven, with a small loss.
With that being said, please don’t worry about rounding issues. You won’t be penalized for rounding error.
Flag question: Question 5Question 52 pts
Exhibit 3 presents static budget variances, which are the differences between the actual and the static budget. Notice that the actual is based on 180,000 actual units assembled and shipped whereas the static budget is based on 200,000 units.
To make the comparison of the actual and the budgeted amounts more meaningful, companies often prepare a budget that is based on the actual units – this is called the flexible budget. Using the Excel template provided in Module 7, prepare a flexible budget based on the actual units 180,000. The step-by-step guidance is provided in the Excel template and explained during the most recent Live Session. After you complete the flexible budget column, compute the flexible budget variances by subtracting the flexible budget from the actual.
Enter your flexible budget total revenue variance here as a positive whole number regardless of whether the variance is favorable or unfavorable.
If your answer from the spreadsheet is 34 or -34, please enter as 34000 because that number is in thousands.
Flag question: Question 6Question 62 pts
Please classify the flexible budget total revenue variance as favorable or unfavorable. Simply select F for favorable and U for unfavorable.
Group of answer choicesFU
Flag question: Question 7Question 72 pts
Enter your flexible budget total variable cost variance here as a positive whole number regardless of whether the variance is favorable or unfavorable.
If your answer from the spreadsheet is 34 or -34, please enter as 34000 because that number is in thousands.
Flag question: Question 8Question 82 pts
Please classify the flexible budget total variable cost variance as favorable or unfavorable. Simply select F for favorable and U for unfavorable.
Group of answer choicesFU
Flag question: Question 9Question 92 pts
Now we will examine flash memory variances in detail. Exhibit 1 provides the standard price for flash memory. The case mentions that Samsung has increased the price by $2. It’s reasonable to assume the standard input per output is one, as one flash memory is expected to be used for each iPhone. Now is the actual input per output still one? Or is it a little bit higher due to the damage of these one thousand flash memories? (Hint: actual input per output = total actual number of flash memories used / actual number of iPhones)
Using the Excel template, set up a variance analysis table to compute flash memory price (spending) variance and efficiency (usage) variance.
Enter your flash memory price (spending) variance here as a positive whole number regardless of whether the variance is favorable or unfavorable. Please enter your number in dollars, not in thousands of dollars.
Flag question: Question 10Question 102 pts
Please classify the flash memory price (spending) variance as favorable or unfavorable. Simply select F for favorable and U for unfavorable.
Group of answer choicesFU
Flag question: Question 11Question 112 pts
Enter your flash memory efficiency (usage) variance here as a positive whole number regardless of whether the variance is favorable or unfavorable. Please enter your number in dollars, not in thousands of dollars.
Flag question: Question 12Question 122 pts
Please classify the flash memory efficiency (usage) variance as favorable or unfavorable. Simply select F for favorable and U for unfavorable.
Group of answer choicesFU
Flag question: Question 13Question 132 pts
Let us examine labor for assembly and packaging variances in detail using an excel spreadsheet template. We will assume the standard labor rate per hour is $0.92. The standard labor cost per unit is provided in Exhibit 1. With this information, you can figure out standard labor hour per unit of output. (Hint: Standard labor hour per unit of output = Standard labor cost per unit / Standard labor rate per hour)
The case mentions that the actual labor rate is 30% higher than the standard labor rate. In addition, total actual labor cost is provided in Exhibit 3. You can compute actual labor hour per unit of output using the following formula:
Total actual labor cost = Actual labor rate per hour X Actual labor hour per unit of output X actual output of iPhones
Now you have all information needed to compute labor rate (price) variance and efficiency (usage) variance.
Enter your labor rate (price) variance here as a positive whole number regardless of whether the variance is favorable or unfavorable. Please enter your number in dollars, not in thousands of dollars.
Flag question: Question 14Question 142 pts
Please classify the labor rate (price) variance as favorable or unfavorable. Simply select F for favorable and U for unfavorable.
Group of answer choicesFU
Flag question: Question 15Question 152 pts
(A) Compare the static budget variances as provided in Exhibit 3 and the flexible budget variances you computed in Questions 5 to 8. Assume that the production manager is primarily responsible for overseeing the efficiency of the production, and that the production level (180,000 units vs. 200,000 units) is not controllable by the production manager. Given these assumptions, is the static budget variance or the flexible budget variance a better, or more objective, measure of the production manager’s performance? In other words, which budget would reflect the manager’s actual performance? Why? (Maximum 200 words)
(B) What information should Wentao Chen, the manager of Danshui Plant No 2., gather to further understand the results of the variance analysis? What are some strategies that Wentao Chen should consider in trying to solve the problems with the Apple iPhone 4 contract in the next nine months? (250 words maximum)
pFlag question: Question 16Question 160 pts
Please submit your spreadsheet you used to calculate variances and breakeven units.
Please ensure that the spreadsheet you submit is a single file and label the worksheets within the file clearly so that we know which worksheet corresponds to which of the above questions.
Upload
Flag question: Question 17Question 171 pts
AI Use Disclosure
In the space below, please provide the following information if you used any generative AI tools while completing this assignment:
In this assignment, I used the following AI tool(s): [name the specific tool(s), e.g., ChatGPT, CoPilot, Gemini, etc.]. I used them to [briefly describe the purpose - e.g., understand concepts, brainstorm ideas, outline content, clarify concepts, edit writing, etc.] for Questions [indicate which question(s) ].
If you did not use any generative AI tools for this assignment, please include a brief statement indicating that no AI tools were used.