The standard cost summary for the most popular product of Fantastic-Four Products Co. is shown as follows, together with production and cost data for the period.

One gallon each of liquid lead and varnish are added at the start of processing. The balance of the materials is added when the process is two-thirds complete. Labor and overhead are added evenly throughout the process.

Required:
1. Calculate equivalent production. (Be sure to refer to the standard cost summary to help determine the percentage of materials in ending work in process.)
2. Calculate materials and labor variances and indicate whether they are favorable or unfavorable, using the diagram format shown in Figure 8-4.

3. Determine the cost of materials and labor in the work in process account at the end of the month.
4. Prove that all materials and labor costs have been accountedfor.

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Standard Cost Summary Materials $4.00 Labor 12.00 Factory overhead $23.00 Production and Cost Summary Units completed during the month..................... 9,000 2,000 21,000 20,000 10,000 S 41,160 S60,000 $117,000 Direct labor hours worked Materialo Varlances Actual cost (Actual quantity used x actual price per unit) Actual quantity used >x standard price per unit Equivalent production × standard quantity per unit X standard price 11,000 lbs. x S3.80 # S41.800 11,000 lbs. × $4.00-$44,000 10,000 units × 1 lb. × $4 $40,000 Materials Price Variance $2,200 F Materials Quantity Variance $4.000 U Net Matorials Variance $1,800 U Labor Varianices Actual hours (Actual hours worked X actual rate per hour) Actual hours worked X standard rate per hour 4,500 hrs. × $10 $45,000 Equivalent production x standard hours per unit × standard rate 4,500 hrs. × $11 = $49,500 10,000 units × 0.5 hr. × $10 = S50.000 Labor Rate Variance $4,500 U Labor Efficiency Variance $5,000 F Net Labor Variance $500 F