West Texas Chemical Company manufactures a product called Kylon, which requires three raw materials Production is in batches of 1,000 gallons of finished product The firm uses standard costs as a control device Its standard costs for materials for each batch of Kylon have been established as follows Material Quantity Standard Cost per Gallon Standard Cost per Batch Starter 720 gal $ 1 20 $ 864 00 Acid 210 gal 3 00 630 00 Activator 70 gal 11 00 770 00 Total standard cost 1,000 gal $ 2,264 00 The output is packaged in 50 gallon drums During the month of June 2019, 200 drums of Kylon were produced There was no beginning or ending inventory of work in process The materials actually used during June are listed below Material Quantity Cost per Gallon Starter 7,270 gal $ 1 10 Acid 2,140 gal 3 30 Activator 490 gal 14 30 Required Compute the total variance between the actual cost of the materials used during June and the standard cost of the materials Also compute the total variance for each type of material Analyze the variances for each type of material for the month Analyze Which raw materials were obtained at a price that was lower than standard cost a Compute the total variance between the actual cost of the materials used during June and the standard cost of the materials Also compute the total variance for each type of material (Indicate the effect of each variance by selecting Favorable, Unfavorable, and None for no effect (i e , zero variance) ) WEST TEXAS CHEMICAL COMPANY Analysis of Materials Variances For Month of June 2019 Costs Variances Cost Elements Standard Actual Quantity Price Starter Standard Actual Quantity variance Price variance Acid Standard Actual Quantity variance Price variance Activator Standard Actual Quantity variance Price variance Totals $0 $0 $0 $0 b Analyze the variances for each type of material for the month (Indicate the effect of each variance by selecting Favorable, Unfavorable, and None for no effect (i e , zero variance) ) Standard Actual Variance Starter Acid Activator Total $0 $0 $0 c Which raw materials were obtained at a price that was lower than standard cost Standard cost

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West Texas Chemical Company manufactures a product called Kylon, which requires three raw materials. Production is in batches of 1,000 gallons of finished product. The

West Texas Chemical Company manufactures a product called Kylon, which requires three raw materials. Production is in batches of 1,000 gallons of finished product. The firm uses standard costs as a control device. Its standard costs for materials for each batch of Kylon have been established as follows:

Material	Quantity		Standard Cost per Gallon			Standard Cost per Batch
Starter	720	gal.		$	1.20		$	864.00
Acid	210	gal.			3.00			630.00
Activator	70	gal.			11.00			770.00
Total standard cost	1,000	gal.					$	2,264.00

The output is packaged in 50-gallon drums. During the month of June 2019, 200 drums of Kylon were produced. There was no beginning or ending inventory of work in process. The materials actually used during June are listed below:

Material	Quantity		Cost per Gallon
Starter	7,270	gal.	$	1.10
Acid	2,140	gal.		3.30
Activator	490	gal.		14.30

Required:

Compute the total variance between the actual cost of the materials used during June and the standard cost of the materials. Also compute the total variance for each type of material.
Analyze the variances for each type of material for the month.

Analyze: Which raw materials were obtained at a price that was lower than standard cost?

Compute the total variance between the actual cost of the materials used during June and the standard cost of the materials. Also compute the total variance for each type of material. (Indicate the effect of each variance by selecting Favorable, Unfavorable, and "None" for no effect (i.e., zero variance).)

WEST TEXAS CHEMICAL COMPANY
Analysis of Materials Variances
For Month of June 2019
	Costs		Variances
Cost Elements	Standard	Actual	Quantity	Price
Starter
Standard
Actual
Quantity variance
Price variance
Acid
Standard
Actual
Quantity variance
Price variance
Activator
Standard
Actual
Quantity variance
Price variance
Totals	$0	$0	$0	$0

Analyze the variances for each type of material for the month. (Indicate the effect of each variance by selecting Favorable, Unfavorable, and "None" for no effect (i.e., zero variance).)