Millet Toy Company manufactures a plastic swimming pool at its Westwood Plant. The plant has been experiencing problems as shown by its June contribution format income statement below. "Contains direct materiak, direct labor, and variable manufacturing owerhead Janet Dunn, who has just been appointed general manager of the Westwood Plant, has been given instructions to "get things under control "Upon reviewing the plant s income statement, Ms. Dunn has concluderd that the major problem lies in the varlable cost of goods sold She has been provided with the following standard cast per swinming pool: "Based on machine hours During duine the nlant moduced 6,000 pools and incurted the following costs a. Purchased 25,400 pounds of materials at a cont of $2.45 per pound 6 Used 20.200 pounds of materiass in production, (Finished goods and work in process iventories ace insignuficant and can be ignored) e. Worked 2,400 itirect laborhours at a cost of $720 per hour. d. incurred variable manufacturing overthead cost totaing 55,100 for the month A totol of 1,500 machine hours was recorded. It is the company's policy to ciose all variances to cost of goods soid on a monthly basis: It is the company's policy to close all variances to cost of goods sold on a monthly basis Required: 1. Compute the following variances for June a. Materials price and quantity variances. b. Labor rate and elficiency variances c. Variable overhead rate and efficiency variances, 2. Summarize the variances that you computed in (t) above by showng the net overall favorable or unfavorable variance for the month. Complete this question by entering your answers in the tabs below. 1a. Compute the following variances for June, materlals price and quantity variances. 1b. Compute the following variances for June, labor rate and efficiency variances. ic Compute the following variances for June, variable overhead rate and efficiency variancos. (Do not round your intermedlate calculations, Indicate the effect of oach variance by selecting "F" for favorabie, "U" for unfavorable, and "Rone" for no effect (i.e, zoro variance), Input all amounts as positive values, ) During June, the plant produced 6,000 pools and incurred the following costs: a. Purchased 25,400 pounds of materials at a cost of $2.45 per pound b. Used 20,200 pounds of materials in production. (Finished goods and work in process imventories are insignificant and can be ignored.) c. Worked 2,400 direct labor-hours at a cost of $720 per hour. d. Incurted variable manufacturing overhead cost totaling $5,100 for the month. A total of 1,500 machine-4ours was recorded. It is the company's policy to close all variances to cost of goods sold on a monthly basis. Required: 1. Compute the following variances for June: a. Materials price and quantity variances. b. Labor rate and efficiency variances c. Vanable overhead rate and efficiency variances. 2. Summarize the variances that you computed in (1) above by showing the net overall favorable or unfavorable variance for the month. Complete this question by entering your answers in the tabs below. Summarize the variances that you computed in (1) above by showing the net overall favorable or unfavorable variance for the month. (tndicate the effect of elach variance by selecting "F" for faverable. "U" for unfavorable, and "None" for no effect (Cie.s. tero variance) toput all amounts as posithe Values
