managerial accountinf 16th edition

Problem 10-14 (Static) Basic Variance Analysis (LO10-1, LO10-2, LO10-3) Becton Labs, Inc., produces various chemical compounds for industrial use. One compound, called Fiudex, is prepared using an elaborate distilling process. The company has developed standard costs for one unit of Fludex, as follows Standard Quantity Standard Price Standard or Hours or Rate Cost Direct materials 2.5 ounces $20.00 per ounce $ 5e.ee Direct labor 1.4 hours $22.5e per hour 31.se Variable manufacturing overhead 1.4 hours $ 3.5e per hour 4.98 Total standard cost per unit $ 86.40 During November the following activity was recorded related to the production of Fludex. a. Materials purchased, 12,000 ounces at a cost of $225,000 b. There was no beginning inventory of materials, however, at the end of the month, 2,500 ounces of material remained in ending inventory c. The company employs 35 lab technicians to work on the production of Fludex. During November, they each worked an average of 160 hours at an average pay rate of $22 per hour. d. Variable manufacturing overhead is assigned to Fludex on the basis of direct labor-hours. Variable manufacturing overhead L 50F 234 PM 11/19/20 Bli a Required: 1 For direct materials a Compute the price and quantity variances b. The materials were purchased from a new supplier who is anxious to enter into a long-term purchase contract Would you recommend that the company sign the contract? 2. For direct labor a Compute the rate and efficiency variances. b. In the past, the 35 technicians employed in the production of Fludex consisted of 20 senior technicians and 15 assistants During November, the company experimented with fewer senior technicians and more assistants in order to reduce labor cost Would you recommend that the new labor mix be continued? 3. Compute the variable overhead rate and efficiency variances, Complete this question by entering your answers in the tabs below. Reg 1A Regis Req 2A Reg 28 Req3 For direct materials, compute the price and quantity variances. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (.e., zero variance). Input all amounts as positive values.) Compute the variable overhead rate and efficiency variances. Complete this question by entering your answers in the tabs below. Req 1A Req1B Req 2A Req 2B Reg 3 er direct materials, compute the price and quantity variances. (Indicate the effect of each variance by selecti worable, "U" for unfavorable, and "None" for no effect (i.e., zero variance), Input all amounts as positive valu erials price variance erials quantity variance Prev 12 of 14 Next Compute the variable overhead rate and efficiency variances Complete this question by entering your answers in the tabs below. Req 1A Req1B Req 2A Reg 2B Reg 3 or direct labor, compute the rate and efficiency variances. (Indicate the effect of each variance by selecti U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) borrate variance bor efficiency variance 12 of 14 . Hello 3. Compute the variable overhead rate and efficiency variances. Complete this question by entering your answers in the tabs below. Req 1A Req18 Reg 2A Req 2B Reg 3 Compute the variable overhead rate and efficiency variances. (Indicate the effect of each variance by sele favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive Variable overhead rate variance Variable overhead efficiency variance