Mackenna Industries projects its unit sales of part 998 to be 16,400 units in January, 19,200 units in February, and 21,000 units in March. Mackenna wants its ending finished goods inventory to equal 21% of the next months expected unit sales. These goals have been met in the past two years. Prepare a production budget for January and February 2020.

MACKENNA INDUSTRIES Production Budget for Part 998 For January and February, 2020
		January		February
Beginning finished goods inventoryTotal required unitsExpected unit salesRequired production unitsDesired ending finished goods
LessAdd: Desired ending finished goodsBeginning finished goods inventoryTotal required unitsExpected unit salesRequired production units
Expected unit salesDesired ending finished goodsBeginning finished goods inventoryRequired production unitsTotal required units
LessAdd: Desired ending finished goodsExpected unit salesRequired production unitsTotal required unitsBeginning finished goods inventory
Desired ending finished goodsExpected unit salesTotal required unitsBeginning finished goods inventoryRequired production units

Charlatte Company has determined that the standard cost to manufacture its product includes 2 units of direct materials at $6.00 per unit. During January, the company purchased 51,200 units of direct materials at a cost of $5.90 per unit and used 51,200 units of direct materials to produce 23,900 units of its product. Calculate the total materials variance, and the price and quantity variances.

Materials Variance		$	Neither favourable nor unfavourableUnfavourableFavourable
Materials Price Variance		$	Neither favourable nor unfavourableFavourableUnfavourable
Materials Quantity Variance		$	UnfavourableNeither favourable nor unfavourableFavourable