Lester’s Oil and Lube Company is a service company that offers oil changes and lubrication for automobiles and light trucks. On average, Lester has found that a typical oil change takes 30 minutes and 6 quarts of oil are used. In June, Lester’s Oil and Lube had 780 oil changes.

Required:

1. Calculate the number of quarts of oil that should have been used (SQ) for 780 oil changes.

2. Calculate the hours of direct labor that should have been used (SH) for 780 oil changes.

3. What if there had been 740 oil changes in June? Would the standard quantities of oil (in quarts) and of direct labor hours be higher or lower than the amounts calculated in Requirements ] and 2? What would the new standard quantities be?

3. Calculate the total direct materials variance for oil for June.
4. What if the actual number of quarts of oil purchased in June had been 4,530 quarts, and the materials price variance was calculated at the time of purchase? What would be the materials price variance (MPV)? The materials usage variance (MUYV):?LO1