Question 1 Badco manufactures bedsheets and pillowcases which it supplies to a major hotel chain. It uses a just in time system and hold no inventories. The standard cost for the cotton which it used to make the bed sheets and pillowcases is $5 per m. Each bed sheet uses 2 m of cotton and each pillow uses 0.5 m. Production levels for bed sheets and pillow cases uses 0.5 m2. Production levels for bed sheets and pillowcases for November were as follows: Budgeted production level in Actual production levels in unit Bed Sheet 120,000 Pillow cases 190,000 units 120,000 180,000 The actual cost of the cotton in November was $ 5.8 per m. 248,000 of cotton was used to make the bed sheets and 95,000 m was used to make the pillowcases. The world commodity prices for cotton increased by 20% in the month of November. At the beginning of the month, the hotel chain made an expected request for an immediate design change to the pillow case. The new design required 10% more cotton than previously. It also resulted in production delays and therefore a shortfall in production of 10,000 pillowcases in total that month. The production manager at Bedco is responsible for all buying and any production issues which occur, although he is not responsible for the setting of standard costs. Required: a) Calculate the following variances for the month of November, for both bed sheets and pillow cases, and in total: ii. iii. 1. Total material price planning variance (3 Marks) Total material price operational variance (3 Marks) Total material usage planning variance. (3 Marks) iv. Total material usage operational variance. (3 Marks) b) Assess the performance of the production manager for the month of November. (8 Marks) c) What are five features of a just-in-time manufacturing system? (5 Marks)