Material mix and yield variance with shrinkage The Mercantile Solvents Company makes X-Myer-K, a powerful rust remover. The standard material mix calls for 80 gallons of XZ-Ote at $1.25 per gallon and 20 gallons of XZ-Yte at $4.00 per gallon. A 100-gallon batch of inputs yields 90 gallons of output. The shrinkage is a normal part of the cooking and distilling process. During the past week, the company manufactured 1,350 gallons of X-Myer-K using 1,300 gallons of XZ-Ote at $1.30 per gallon and 240 gallons of XZ-Yte at $3.85 per gallon.

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REQUIRED a. Compute the standard and actual material cost for the product. b. Compute the material price variances. c. Compute the material quantity variances. d. Compute the material mix and yield variances.