Wonderfult Not only did our salespeople do a good job in meeting the sales buoget this year, but our production people did a good job in controlling costs as well," said Kim Clark, president of Marteil Company. "Our $30.350 overall manufacturing cost variance is only 1.0% of the $3,035,000 standard cost of products made during the year. That's well within the 3\% parameter set by management for acceptable variances. It looks like everyone will be in line for a bonus this year: The company produces and sells a single product. The standard cost card for the product follows: The following additional information is available for the year just completed: a. The company manufactured 25.000 units of product during the yeac. b. A total of 110.000 feet of material was purchased during the year at a cost of $2.75 per foot. All of this material was used to manufacture the 25.000 units produced. There were no beginning of ending inventonies for the year. c. The company worked 75,000 direct labor-hours during the year at a direct labor cost of $8.70 per hour. d. Overhead is applied to products on the basis of standard direct labor-hours. Data relating to manufacturing overhead costs follow: Required: 1 Compute the materials price and quantity vartances for the yeat. 2 Compute the labor rate and efficiency variances for the yeat 3. For manufacturing overhead compute- a. The vanable overtiead rate and efficiency variances for the yeat b. The fived overhead budget and volume variances for the year. (For alf requirements, 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.) a. The company manufactured 25,000 units of product during the year b. A total of 110,000 feet of material was purchased during the year at a cost of $275 per foot All of this material was used to manufacture the 25,000 units produced. There were no beginning or cnding inventories for the year? C. The company worked 75,000 direct labor-hours during the year at a direct labof cost of $870 per hour. d. Overhead is applied to products on the basis of standard direct labor-houirs. Data relating to manufacturing overnead costs follov Required: 1. Compute the materials price and quantity variances for the year. 2. Compute the labor rate and efficiency variances for the year. 3. For manulacturing overhead compute: a. The variable overhead rate and efficiency variances for the year. b. The fixed overhead budget and volume variances for the year. (For all requirements, indicate the effect of each variance by selecting "F" for favorable, "U" for unfavarable, and "None" for no effect (i.e., zero variance). Input all amounts as positive volues.)
