Please show all work and answer all questions please! Thank you. Marvel Parts, I

Question

Please show all work and answer all questions please!

Thank you.

Marvel Parts, Inc., 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:

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:

At standard, each set of covers should require 1.50 yards of material. All of the materials purchased during the month were used in production.

Compute the materials price and quantity variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Round your intermediate calculations to 2 decimal places. Round "Standard Price" and "Actual Price" answers to 2 decimal places.)

Compute the labor rate and efficiency variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Round your intermediate calculations to 2 decimal places. Round "Standard Rate" and "Actual Rate" answers to 2 decimal places.)

Compute the variable overhead rate and efficiency variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Round your intermediate calculations to 2 decimal places. Round "Standard Rate" and "Actual Rate" answers to 2 decimal places.)

Marvel Parts, Inc., 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:

Explanation / Answer

Standard cost calculation:

Type of cost Total Per set of covers Standard cost

Direct Materials $26964 * $12.60 = $339746.4

Direct Labour $11770 * $ 5.50 = $ 64735

Overhead cost $ 3638 * $1.70 = $ 6184.6

Total standard cost = $410666

Actual cost calculation:

Type of cost Total Per set of covers Standard cost

Direct Materials $29280 * $12.20 = $357216

Direct Labour $13680 * $ 5.70 = $ 77976

Overhead cost $ 5760 * $2.40 = $13824

Total Actual cost = $449016

Variance= Total Standard cost - Total Actual cost = $410666 - $449016 = $38350   

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