Polysar Case
AGENDA
Polysar Ltd.
• Introduction to Polysar • Standard Costing • Variance Analysis for Variable Costs • Fixed Overhead Volume Variance • Transfer Pricing
AGENDA
Polysar Ltd.
• Introduction to Polysar • Standard Costing • Variance Analysis for Variable Costs • Fixed Overhead Volume Variance • Transfer Pricing
POLYSAR
• Canada’s largest chemical company. • The Rubber Group accounts for 46% of Polysar’s sales. • Primary products for this group are butyl and halobutyl. • Principal customers for these products are tire manufacturers. • Rubber Group has two divisions
– NASA (North America & South America) – EROW (Europe & elsewhere)
POLYSAR
• Butyl is manufactured by NASA at its Sarnia 2 plant, and by EROW at its Antwerp …show more content…
POLYSAR
1c) Interpret the amount $21,450 on Exhibit 2, for variable costs.
E x hib it 2
N A S A R U B B E R D IV IS IO N R e g u la r B u t y l R u b b e r S t a t e m e n t o f N e t C o n t r ib u t io n S e p te m b e r 1 9 8 6
9 M o n th s e n d e d S ep t. 3 0 , 1 9 8 6 A c tu al ( ‘ 0 0 0 's ) S a le s R e v e n u e - T h i r d P a r t y - D ive r sifie d P r o d u c t G ro u p - T o tal D e l i ve ry C o s t N et S ales R e ve n u e V a ri a b l e C o s t s S tan d ar d C o s t A d ju stm e n ts E f fic ie n c y V a r ia n c e T o tal G ro s s M a rg i n - $ 6 5 ,8 1 6 6 ,0 - 2 ,7 6 3 ,2 7 6 3 9 3 2 0 2 3 9 9 4 1 4 B u dget ( ‘0 0 0 's ) 6 1 ,0 2 6 1 ,2 - 2 ,6 5 8 ,6 5 1 6 0 6 0 0 0 0 0 D e viatio n ( ‘ 0 0 0 's ) 4 ,8 2 5 4 ,7 2 19 4 ,5 7 - 1 ,1 3 5 24 84 2 0 2 3 9 9 4 1 4
-2 2 ,5 8 5 24 -2 2 ,2 9
-2 1 ,4 5 0 -2 1 ,4 5 0 3 7 ,2 1 0 -2 3 ,1 0 0 8 0 - 6 ,1 2 5 -2 9 ,1 4 5 8 ,0 6 5
4 0 ,9 4 5 -2 5 ,0 1 4 -1 1 ,3 -3