Marvel Parts, Inc., manufactures auto accessories. One of the companyâs products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 630 hours each month to produce 2,100 sets of covers. The standard costs associated with this level of production are: Total Per Set of Covers Direct materials $ 38,640 $ 18.40 Direct labor $ 6,300 3.00 Variable manufacturing overhead (based on direct labor-hours) $ 3,150 1.50 $ 22.90 During August, the factory worked only 500 direct labor-hours and produced 2,000 sets of covers. The following actual costs were recorded during the month: Total Per Set of Covers Direct materials (5,000 yards) $ 36,000 $ 18.00 Direct labor $ 6,400 3.20 Variable manufacturing overhead $ 4,400 2.20 $ 23.40 At standard, each set of covers should require 2.30 yards of material. All of the materials purchased during the month were used in production. Required 1. Compute the materials price and quantity variances for August. (Input all amounts as positive values. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e, zero variance).) 2. Compute the labor rate and efficiency variances for August. (Input all amounts as positive values. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e, zero variance).) 3. Compute the variable overhead rate and efficiency variances for August. (Input all amounts as positive values. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e, zero variance).)
Marvel Parts, Inc., manufactures auto accessories. One of the companyâs products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 630 hours each month to produce 2,100 sets of covers. The standard costs associated with this level of production are: Total Per Set of Covers Direct materials $ 38,640 $ 18.40 Direct labor $ 6,300 3.00 Variable manufacturing overhead (based on direct labor-hours) $ 3,150 1.50 $ 22.90 During August, the factory worked only 500 direct labor-hours and produced 2,000 sets of covers. The following actual costs were recorded during the month: Total Per Set of Covers Direct materials (5,000 yards) $ 36,000 $ 18.00 Direct labor $ 6,400 3.20 Variable manufacturing overhead $ 4,400 2.20 $ 23.40 At standard, each set of covers should require 2.30 yards of material. All of the materials purchased during the month were used in production. Required 1. Compute the materials price and quantity variances for August. (Input all amounts as positive values. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e, zero variance).) 2. Compute the labor rate and efficiency variances for August. (Input all amounts as positive values. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e, zero variance).) 3. Compute the variable overhead rate and efficiency variances for August. (Input all amounts as positive values. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e, zero variance).)
Related questions
Marvel Parts, Inc., manufactures auto accessories. One of thecompanyâs products is a set of seat covers that can be adjusted tofit nearly any small car. The company has a standard cost system inuse for all of its products. According to the standards that havebeen set for the seat covers, the factory should work 995 hourseach month to produce 1,990 sets of covers. The standard costsassociated with this level of production are:
| Total | PerSet of Covers | ||||
| Directmaterials | $ | 47,362 | $ | 23.80 | |
| Direct labor | $ | 8,955 | 4.50 | ||
| Variable manufacturingoverhead (based on direct labor-hours) | $ | 2,388 | 1.20 | ||
| $ | 29.50 | ||||
During August, the factory worked only 1,000 direct labor-hoursand produced 2,300 sets of covers. The following actual costs wererecorded during the month:
| Total | PerSet of Covers | ||||
| Direct materials(8,800 yards) | $ | 50,600 | $ | 22.00 | |
| Direct labor | $ | 10,580 | 4.60 | ||
| Variable manufacturingoverhead | $ | 4,600 | 2.00 | ||
| $ | 28.60 | ||||
At standard, each set of covers should require 3.50 yards ofmaterial. All of the materials purchased during the month were usedin production.
Required
1. Compute the materials price and quantity variances forAugust.
2. Compute the labor rate and efficiency variances forAugust.
3. Compute the variable overhead rate and efficiency variancesfor August.
Marvel Parts, Inc., manufactures auto accessories. One of the companyâs products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 2,850 hours each month to produce 1,900 sets of covers. The standard costs associated with this level of production are:
| Total | Per Set of Covers | ||||
| Direct materials | $ | 42,560 | $ | 22.40 | |
| Direct labor | $ | 51,300 | 27.00 | ||
| Variable manufacturing overhead (based on direct labor-hours) | $ | 6,840 | 3.60 | ||
| $ | 53.00 | ||||
During August, the factory worked only 2,800 direct labor-hours and produced 2,000 sets of covers. The following actual costs were recorded during the month:
| Total | Per Set of Covers | ||||
| Direct materials (12,000 yards) | $ | 45,600 | $ | 22.80 | |
| Direct labor | $ | 49,000 | 24.50 | ||
| Variable manufacturing overhead | $ | 7,000 | 3.50 | ||
| $ | 50.80 | ||||
At standard, each set of covers should require 5.6 yards of material. All of the materials purchased during the month were used in production.
Required:
1. Compute the materials price and quantity variances for August.
2. Compute the labor rate and efficiency variances for August.
3. Compute the variable overhead rate and efficiency variances for August.
(Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
