ACC 102 25 Point Problem 4 Wagner Company developed the following standard andard costs for its product for 2012 Standard Cost WAGNER COMPANY Standard Cost Card Standard Quantity * Standard Price 4 pounds $ 5 $20 20 Cost Elements Direct materials Direct labor Variable overhead Fixed overhead 2 hours 2 hours 2 hours $52 the company expected to work at the 120 000 direct labor hours level of activity and produce 60,000 units of product Actual results for 2012 were as follows: 56,800 units of product were actually produced Direct labor costs were $1,092,000 for 112.000 direct labor hours actually worked. Actual direct materials purchased and used during the year cost $1,108,800 for 231.000 pounds Total actual manufacturing overhead costs were $680,000 Instructions Compute the following variances for Wagner Company for 2012 and indicate whether the variance is favorable or unfavorable 1. Direct materials price variance 2. Direct materials quantity variance. 3. Direct labor price variance. 4. Direct labor quantity variance. Required information [The following information applies to the questions displayed below) Black Diamond Company produces snow skis. Each ski requires 2 pounds of carbon fiber. The company's management predicts that 5,000 skis and 6.000 pounds of carbon fiber will be in inventory on June 30 of the current year and that 150,000 skis will be sold during the next (third) quarter. A set of two skis sells for $300. Management wants to end the third quarter with 3,500 skis and 4.000 pounds of carbon fiber in inventory. Carbon fiber can be purchased for $15 per pound. Each ski requires 0.5 hours of direct labor at $20 per hour. Variable overhead is applied at the rate of $8 per direct labor hour. The company budgets fixed overhead of $1,782,000 for the quarter Required: 1. Prepare the third-quarter production budget for skis. BLACK DIAMOND COMPANY Production Budget (in units) Third Quarter Required units of available production Units to be manufactured 3 4 4 13 Score