Marvel Parts, Inc., manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company uses a standard cost system for all of its products. According to the standards that have been set for the seat covers, the factory should work 630 hours each month to produce 2,100 sets of covers. The standard costs associated with this level of production are: Total $ 38,640 $ 6,300 Per Set of Covers $18.40 3.00 Direct materials Direct labor Variable manufacturing overhead (based on direct labor-hours) $ 3,150 1.50 $22.90 During August, the factory worked only 500 direct labor-hours and produced 2,000 sets of covers. The following actual costs were recorded during the month: Direct materials (5,000 yards) Direct labor Variable manufacturing overhead Total $ 36,000 $ 6,400 $ 4,400 Per Set of Covers $18.00 3.20 2.20 $ 23.40 At standard, each set of covers should require 2.3 yards of material. All of the materials purchased during the month were used in production. Required: 1. Compute the materials price and quantity variances for August. 2. Compute the labor rate and efficiency variances for August. 3. Compute the variable overhead rate and efficiency variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) At standard, each set of covers should require 2.3 yards of material. All of the materials purchased during the month were used in production. Required: 1. Compute the materials price and quantity variances for August. 2. Compute the labor rate and efficiency variances for August. 3. Compute the variable overhead rate and efficiency variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Answer is complete but not entirely correct. 1. $ 4,000 F Materials price variance Materials quantity variance $ 3,200 U 2. Labor rate variance $ 17,920 X U Labor efficiency variance Variable overhead rate variance Variable overhead efficiency variance 3. $ 61,000 XF $ 1,900 U $ 6,100 F You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you review the company's costing system and do what you can to help us get better control of our manufacturing overhead costs. You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step in overhead planning and control. After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for March: Utilities Maintenance Supplies Indirect labor Depreciation Cost Formula $16,000 + $0.15 per machine-hour $38,300 + $2.10 per machine-hour $0.60 per machine-hour $94,300 + $1.70 per machine-hour $67,600 Actual Cost in March $ 20,650 $ 72,000 $ 11,200 $ 127,500 $ 69,300 During March, the company worked 17,000 machine-hours and produced 11,000 units. The company had originally planned to work 19,000 machine-hours during March. Required: 1. Prepare a flexible budget for March. 2. Prepare a report showing the spending variances for March. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a flexible budget for March. (Input all amounts as positive values.) FAB Corporation Flexible Budget For the Month Ended March 31 Machine-hours Utilities Maintenance Supplies Indirect labor Depreciation Total Required 1 Required 2 Prepare a report showing the spending variances for March. (Indicate the effect favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). In FAB Corporation Spending Variances For the Month Ended March 31 Utilities Maintenance Supplies Indirect labor Depreciation Total The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses in its budgeting and performance reports-the number of courses and the total number of students. For example, the school might run two courses in a month and have a total of 60 students enrolled in those two courses. Data concerning the company's cost formulas appear below: Fixed Cost per cost per Month Course $ 2,930 Cost per Student $ 260 $ 60 Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses $1,230 $4,600 $2,100 $ 4,000 $ 41 $ 7 For example, administrative expenses should be $4,000 per month plus $41 per course plus $7 per student. The company's sales should average $880 per student. The company planned to run four courses with a total of 60 students; however, it actually ran four courses with a total of only 58 students. The actual operating results for September appear below: Revenue Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Actual $ 49,900 $ 11,000 $ 15,450 $ 1,880 $ 4,600 $ 2, 240 $ 4,010 Required: 1. Prepare the company's planning budget for September. 2. Prepare the company's flexible budget for September. 3. Calculate the revenue and spending variances for September. Required: 1. Prepare the company's planning budget for September. 2. Prepare the company's flexible budget for September. 3. Calculate the revenue and spending variances for September. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare the company's planning budget for September. Gourmand Cooking School Planning Budget For the Month Ended September 30 Revenue Expenses: Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Total expense Net operating income 0 0 Required: 1. Prepare the company's planning budget for September. 2. Prepare the company's flexible budget for September. 3. Calculate the revenue and spending variances for September. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare the company's flexible budget for September. Gourmand Cooking School Flexible Budget For the Month Ended September 30 Revenue Expenses: Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Total expense Net operating income 0 $ 0 3. Calculate the revenue and spending variances for September. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Calculate the revenue and spending variances for September. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Gourmand Cooking School Revenue and Spending Variances For the Month Ended September 30 Actual Revenue and Spending Results Variances Flexible Budget 4 Courses Students 58 $ 49,900 Revenue Expenses: Instructor wages Classroom supplies 11,000 15,450 Utilities 1,880 Campus rent 4,600 Insurance 2,240 Administrative expenses 4,010 39,180 Total expense Net operating income $ 10,720