Marvel Parts, Inc., manufactures auto accessories. One of the companys products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,010 hours each month to produce 2,020 sets of covers. The standard costs associated with this level of production are:

	Total		Per Set of Covers
Direct materials	$	36,360	$	18.00
Direct labor	$	7,070		3.50
Variable manufacturing overhead (based on direct labor-hours)	$	3,030		1.50
			$	23.00

During August, the factory worked only 1,080 direct labor-hours and produced 2,700 sets of covers. The following actual costs were recorded during the month:

	Total		Per Set of Covers
Direct materials (8,100 yards)	$	46,980	$	17.40
Direct labor	$	9,990		3.70
Variable manufacturing overhead	$	4,590		1.70
			$	22.80

At standard, each set of covers should require 2.0 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.)

Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations:

Budgeted selling price per unit	$	97
Budgeted unit sales (all on credit):
January		10,000
February		12,000
March		13,300
April		15,200

Raw materials requirement per unit of output		4	pounds
Raw materials cost	$	1.00	per pound
Direct labor requirement per unit of output		2.5	direct labor-hours
Direct labor wage rate	$	23.00	per direct labor-hour
Predetermined overhead rate (all variable)	$	9.00	per direct labor-hour
Variable selling and administrative expense	$	3.10	per unit sold
Fixed selling and administrative expense	$	70,000	per month

Credit sales are collected:

30% in the month of the sale

70% in the following month

Raw materials purchases are paid:

30% in the month of purchase

70% in the following month

The ending finished goods inventory should equal 30% of the following month's sales. The ending raw materials inventory should equal 10% of the following months raw materials production needs.

The estimated cost of goods sold for February is closest to:

Multiple Choice

• $846,000

• $1,008,000

• $738,000

• $270,000

Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations:

Budgeted selling price per unit	$	97
Budgeted unit sales (all on credit):
January		10,000
February		12,000
March		13,300
April		15,200

Raw materials requirement per unit of output		4	pounds
Raw materials cost	$	1.00	per pound
Direct labor requirement per unit of output		2.5	direct labor-hours
Direct labor wage rate	$	23.00	per direct labor-hour
Predetermined overhead rate (all variable)	$	9.00	per direct labor-hour
Variable selling and administrative expense	$	3.10	per unit sold
Fixed selling and administrative expense	$	70,000	per month

Credit sales are collected:

30% in the month of the sale

70% in the following month

Raw materials purchases are paid:

30% in the month of purchase

70% in the following month

The ending finished goods inventory should equal 30% of the following month's sales. The ending raw materials inventory should equal 10% of the following months raw materials production needs.

The estimated unit product cost is closest to:

Multiple Choice

• $22.50

• $70.50

• $84.00

• $61.50