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Becton Labs, Inc, produces various chemical compouinds for indistrur use One conpound, called Fudex, is prepared using an eiaborate distiting process. The compary has developed
Becton Labs, Inc, produces various chemical compouinds for indistrur use One conpound, called Fudex, is prepared using an eiaborate distiting process. The compary has developed standerd costs for one unt of Fladek, as follown Oaring November, the following ectivity was recorded relased to the areduction of Fludex 9. Materials purchased, 10000 ounces al a cost of 5289,800 6. There was ho beginning invertary of materias, however, at the end of the month, 4.050 ounces of batenal remained in ending iventory. c. The compary employs 26 lat technctans to work on the preductish of Fludex During Novembet they each worked an average of 150 hours at en everege pay rase of 51500 per hour id Variable manulacturing oveithead is ascigned to Fludex on the buss of diect tabor thours Varhable manufacturing cverhesd costs cunng Nevember totaled 55000 e. During November the compary picduced 3900 unts of Fudex. Required: 1. For disect materials a. Compute the price and quantity varances. the masenlals were guichased from a new supplee who is anvious to erher into a long term puadsase contract Would you. recommend that the combery sign the contract? 2. for cirect tabor a Compute the tate ard eficiency varances b in the pact the 26 lechicians emploped in the podoction of Huder consived of 6 seniar techniciars and 20 assistants Duing November, the eotgany experimented with fewer sentar technicians and mere assesants in order to reduce labor costs. Would you iecominend that the new labor max be contrued? 3 Campuse the vanable overhead rate and efficiency vatiancer
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