Problem 10-9 (Algo) Comprehensive Variance Analysis [LO10-1, LO10-2, LO10-3] Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,070 hours each month to produce 2,140 sets of covers. The standard costs associated with this level of production are: Total Direct materials $ 26,964 Direct labor $ 11,770 Per Set of Covers $ 12.60 5.50 Variable manufacturing overhead (based on direct labor-hours) $ 3,638 1.70 $ 19.80 During August, the factory worked only 1,000 direct labor-hours and produced 2,400 sets of covers. The following actual costs were recorded during the month: Direct materials (6,000 yards) Direct labor Variable manufacturing overhead Total Per Set of Covers $ 29,280 $ 13,680 $ 5,760 $ 12.20 5.70 2.40 $ 20.30 At standard, each set of covers should require 1.5 yards of material. All of the materials purchased during the month were used in production. Required: 1. Compute the materials price and quantity variances for August. 2. Compute the labor rate and efficiency variances for August. 3. Compute the variable overhead rate and efficiency variances for August. (Do not round intermediate calculations. 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.) 1. Materials price variance 1. Materials quantity variance 2. Labor rate variance 2. Labor efficiency variance 3. Variable overhead rate variance 3. Variable overhead efficiency variance
Problem 10-9 (Algo) Comprehensive Variance Analysis [LO10-1, LO10-2, LO10-3] Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,070 hours each month to produce 2,140 sets of covers. The standard costs associated with this level of production are: Total Direct materials $ 26,964 Direct labor $ 11,770 Per Set of Covers $ 12.60 5.50 Variable manufacturing overhead (based on direct labor-hours) $ 3,638 1.70 $ 19.80 During August, the factory worked only 1,000 direct labor-hours and produced 2,400 sets of covers. The following actual costs were recorded during the month: Direct materials (6,000 yards) Direct labor Variable manufacturing overhead Total Per Set of Covers $ 29,280 $ 13,680 $ 5,760 $ 12.20 5.70 2.40 $ 20.30 At standard, each set of covers should require 1.5 yards of material. All of the materials purchased during the month were used in production. Required: 1. Compute the materials price and quantity variances for August. 2. Compute the labor rate and efficiency variances for August. 3. Compute the variable overhead rate and efficiency variances for August. (Do not round intermediate calculations. 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.) 1. Materials price variance 1. Materials quantity variance 2. Labor rate variance 2. Labor efficiency variance 3. Variable overhead rate variance 3. Variable overhead efficiency variance
Chapter1: Financial Statements And Business Decisions
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![Problem 10-9 (Algo) Comprehensive Variance Analysis [LO10-1, LO10-2, LO10-3]
Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted
to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have
been set for the seat covers, the factory should work 1,070 hours each month to produce 2,140 sets of covers. The standard costs
associated with this level of production are:
Total
Direct materials
$ 26,964
Direct labor
$ 11,770
Per Set of
Covers
$ 12.60
5.50
Variable manufacturing overhead (based on
direct labor-hours)
$ 3,638
1.70
$ 19.80
During August, the factory worked only 1,000 direct labor-hours and produced 2,400 sets of covers. The following actual costs were
recorded during the month:
Direct materials (6,000 yards)
Direct labor
Variable manufacturing overhead
Total
Per Set of
Covers
$ 29,280
$ 13,680
$ 5,760
$ 12.20
5.70
2.40
$ 20.30
At standard, each set of covers should require 1.5 yards of material. All of the materials purchased during the month were used in
production.
Required:
1. Compute the materials price and quantity variances for August.
2. Compute the labor rate and efficiency variances for August.
3. Compute the variable overhead rate and efficiency variances for August.
(Do not round intermediate calculations. 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.)
1. Materials price variance
1. Materials quantity variance
2. Labor rate variance
2. Labor efficiency variance
3. Variable overhead rate variance
3. Variable overhead efficiency variance](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa01a145c-49f9-4ef2-8950-2eff328282cc%2F284602b2-b19f-4d6b-9bd3-52d3c47d51e1%2Fj9d7hto_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Problem 10-9 (Algo) Comprehensive Variance Analysis [LO10-1, LO10-2, LO10-3]
Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted
to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have
been set for the seat covers, the factory should work 1,070 hours each month to produce 2,140 sets of covers. The standard costs
associated with this level of production are:
Total
Direct materials
$ 26,964
Direct labor
$ 11,770
Per Set of
Covers
$ 12.60
5.50
Variable manufacturing overhead (based on
direct labor-hours)
$ 3,638
1.70
$ 19.80
During August, the factory worked only 1,000 direct labor-hours and produced 2,400 sets of covers. The following actual costs were
recorded during the month:
Direct materials (6,000 yards)
Direct labor
Variable manufacturing overhead
Total
Per Set of
Covers
$ 29,280
$ 13,680
$ 5,760
$ 12.20
5.70
2.40
$ 20.30
At standard, each set of covers should require 1.5 yards of material. All of the materials purchased during the month were used in
production.
Required:
1. Compute the materials price and quantity variances for August.
2. Compute the labor rate and efficiency variances for August.
3. Compute the variable overhead rate and efficiency variances for August.
(Do not round intermediate calculations. 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.)
1. Materials price variance
1. Materials quantity variance
2. Labor rate variance
2. Labor efficiency variance
3. Variable overhead rate variance
3. Variable overhead efficiency variance
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