Mix and yield variances with shrinkage Diane Huber's Food Products makes an extensive line of canned soups and stews. Diane Huber's beef stew is manufactured in batches and packaged in two-pound cans for sale to customers. Material standards for a typical production batch are presented below. The output from a normal batch of stew is 1,000 pounds. Some shrinkage occurs in the cooking process.

During the month, 7,500 cans of stew were manufactured and the following material costs were incurred:

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Quantity Price Total Material Beef ..... (Pound) (Pound) Cost 200 $1.60 $ 320 Beef broth Potatoes.. Tomatoes Sugar. 500 .30 150 200 .15 30 100 .40 40 50 .30 15 Spices Totals 50 2.10 105 1,100 $ 660