Page 1 of 2 Problem 1 (25 points) Pennock Corporation produces clectronic brain stimulators designed to send an electrical charge to the human brain to "jump start" brain functions. Students find it particularly helpful when taking accounting tests. The standards to produce one stimulator are attached. Also, during the year, the allached actual activity results Louk place for the production of stimulators. Nomal activity for a year is 50,000 direct lalxx hours. Standard manufacturing overhead rates are computed Isased upxin normal activity, REQUIRED: Calculate the following variances for the company for the year. Round all answers to the nearest whole callar. (a) Direct materials (for each malerial individually) price variance (b) Direct materials (for each malerial individually) quantity variance (c) Direct labor price rale) variance. (1) Direct labor quantity (elliciency) variance (e) Varihle overheid price (pending) variance (0) Variable overhead quantity efficiency) variance. Fixed overhead price spending) variance. (1) Fixed overhead volume variance Page 2 of 2 PENNOCK CORPORATION STANDARDS FOR PRODUCTION OF ONE STIMULATOR Direct Materials Wire 4.0 meters at 50.25 per meter Dire Muerials-Perer Park 1.0 pack at S7.50 per KK Direct Materials--Electrodes 1.0 lectrodes at $1.50 per clectrode Direct Lahor 1.5 labor hours at $9.50 per hour Vorinble Moufacturing Overhead 1.5 labor hours at $4.00 per Inbor hour Fixed Manufacturing Overhead 1.5 labox hours at $8.50 per labur hour PENNOCK CORPORATION ACTUAL RESULTS FOR PRODUCTION OF STIMULATORS FOR CURRENT YEAR Stimulators Produced 40,000 Wire Purchased and Used 165.000 meters al a lutalxw of 941.61X) Power Packs Purchased and used 400,000 packs at a total cost of $17.50%) Electrodes (Purchased) 600,000 electrodes al $1.40 per electrode Electrodes (Used) 40.300 clectrodes Direct Labor 60,600 Ixus at $9.25 per hour Actual Variable Mabufacturing Overhead S 258.000 Actual Fixed Manufacturing Overhead S 495,000