Problem 10-15 (Algo) Comprehensive Variance Analysis [LO10-1, LO10-2, LO10-3] Miller 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 materiais, direct labor, and variable manufacturing overhead Janet Dunn, who has just been appointed general manager of the Westwood Plant, has been given instructions to "get things undet control "Upon reviewing the plant's income statement, Ms. Dunn has concluded that the major problem lies in the variable cost of goods sold. She has been provided with the following standard cost per swimming pool. "Contains direct materials, direct labor, and variable manufacturing overthead Janet Dunn, who has just been appointed general manager of the Westwood Plant, has been given instructions to "get things under control" Upon revewing the plant's income statement, Ms. Dunn has concluded that the major problem lies in the variable cost of goods sold She has been provided with the following standard cost per swirnming pool: -Based on machine-hours During June, the plant produced 6.000 pools and incurred the following costs. a. Purchased 29,000 pounds of materials at a cost of $305 per pound b. Used 23,800 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 $7.80 per hout. d Incurred vartable manufacturing overhead cost totaling $8,400 for the month. A total of 2,100 machine-hours was recorded It is the comparty's policy to close all variances to cost of goodis sold on a monthly basis. Required: 1. Compute the following variances for June: a. Materiaks price and quantity variances Required: 1 Compute the following variances for June: a. Materials price and quantity variances b. Labor rate and efficiency variances. c. Variable overhead rate and efficiency variances. 2. Summarize the variances that you computed in requirement 1 by showing the net overall favorable or unfavorable variance for the manth Complete this question by entering your answers in the tabs below. 13. Compute the following variances for June, materlals price and quantity variances. 16. Compute the following variances for June, labor rate and etficiency varianced. 1c. Compute the following varlances for June, varlable overhead rate and efficlency vatiances. (Po not round your intermediate calculations. Indicate the effect of each varlanco by selecting "c" for favorabte, "u* for unfiavorable. and "None" for no ntfect (f.e. zero varlance). Inpat all amounts ae positive values.) 1a. Compute the following variances for June, materials price and quantity variance 1b. Compute the following variances for June, labor rate and efficiency variances. 1c. Compute the following variances for June, variable overhead rate and efficiency (Do not round your intermediate calculations. Indicate the effect of each variance by unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as posi 2. Summarize the variances that you computed in requirement 1 by showing the net overall favorable or unfavorable varianc month. Complete this question by entering your answers in the tabs below. Summarize the variances that you computed in requirement 1 by showing the net overall favorable or unfavorable variance for the month. (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.)
