Exercise 11-7

Pearl City uses a standard costing system. For production of a fuel cell, standards call for 4 model RN-3 valves per cell costing $2,210 each. During 2018, the company purchased 250 valves for $620,000. The company used 260 valves in the production of 63 fuel cells (8 valves were ruined through installation error). Calculate material price and quantity variances for the model RN-3 valves. (Enter all variances as a positive number.)

Material Price Variance		$		FavorableNeither Unfavorable nor FavorableUnfavorable
Material Quantity Variance		$		Neither Unfavorable nor FavorableFavorableUnfavorable