Variable cost of goods sold* Miller Toy Company manufactures a plastic swimming pool at its Westwood...

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Variable cost of goods sold* Miller Toy Company manufactures a plastic swimming pool at its Westwood Plant. The plant has been experiencing problems as shown by its June contribution format income statement below: Sales (15,000 pools) Variable expenses: Flexible Budget $675,000 Actual $675,000 435,000 461,890 20,000 20,000 455,000 481,890 220,000 193,110 130,000 130,000 84,000 84,000 214,000 214,000 $ 6,000 $ (20,890) Variable selling expenses Total variable expenses Contribution margin Fixed expenses: Manufacturing overhead Selling and administrative Total fixed expenses Net operating income (loss) *Contains direct materials, direct labor, and variable manufacturing overhead. Janet Dunn, who has just been appointed general manager of the Westwood Plant, has been given instructions to "get things under control." Upon reviewing the plant's income statement, Ms. Dunn has concluded that the major problem lies in the variable cost of goods sold. She has been provided with the following standard cost per swimming pool: Standard Quantity or Hours 3.0 pounds 0.8 hours Direct materials Direct labor Variable manufacturing overhead 0.4 hours* Standard Price or Rate $5.00 per pound $ 16.00 per hour Standard Cost $ 15.00 12.80 1.20 $ 3.00 per hour $ 29.00 Total standard cost per unit *Based on machine-hours. During June the plant produced 15,000 pools and incurred the following costs: a. Purchased 60,000 pounds of materials at a cost of $4.95 per pound. b. Used 49,200 pounds of materials in production. (Finished goods and work in process inventories are insignificant and can be ignored.) c. Worked 11,800 direct labor-hours at a cost of $17.00 per hour. d. Incurred variable manufacturing overhead cost totaling $18,290 for the month. A total of 5,900 machine-hours was recorded. It is the company's policy to close all variances to cost of goods sold on a monthly basis. Required: 1. Compute the following variances for June: a. Materials price and quantity variances. b. Labor rate and efficiency variances. c. Variable overhead rate and efficiency variances. 2. Summarize the variances that you computed in (1) above by showing the net overall favorable or unfavorable variance for the month. Complete this question by entering your answers in the tabs below. Required 1 Required 2 1a. Compute the following variances for June, materials price and quantity variances. 1b. Compute the following variances for June, labor rate and efficiency variances. 1c. Compute the following variances for June, variable overhead rate and efficiency variances. (Do not round your 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.) 1a. Material price variance 1a. Material quantity variance 1b. Labor rate variance 1b. Labor efficiency variance 1c. Variable overhead rate variance 1c. Variable overhead efficiency variance < Required 1 Required 2 > Show less Required 1 Required 2 Summarize the variances that you computed in (1) above by showing the net overall favorable or unfavorable variance for the month. (Indicate the effect of variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input the amount as positive value.) Net variance Variable cost of goods sold* Miller Toy Company manufactures a plastic swimming pool at its Westwood Plant. The plant has been experiencing problems as shown by its June contribution format income statement below: Sales (15,000 pools) Variable expenses: Flexible Budget $675,000 Actual $675,000 435,000 461,890 20,000 20,000 455,000 481,890 220,000 193,110 130,000 130,000 84,000 84,000 214,000 214,000 $ 6,000 $ (20,890) Variable selling expenses Total variable expenses Contribution margin Fixed expenses: Manufacturing overhead Selling and administrative Total fixed expenses Net operating income (loss) *Contains direct materials, direct labor, and variable manufacturing overhead. Janet Dunn, who has just been appointed general manager of the Westwood Plant, has been given instructions to "get things under control." Upon reviewing the plant's income statement, Ms. Dunn has concluded that the major problem lies in the variable cost of goods sold. She has been provided with the following standard cost per swimming pool: Standard Quantity or Hours 3.0 pounds 0.8 hours Direct materials Direct labor Variable manufacturing overhead 0.4 hours* Standard Price or Rate $5.00 per pound $ 16.00 per hour Standard Cost $ 15.00 12.80 1.20 $ 3.00 per hour $ 29.00 Total standard cost per unit *Based on machine-hours. During June the plant produced 15,000 pools and incurred the following costs: a. Purchased 60,000 pounds of materials at a cost of $4.95 per pound. b. Used 49,200 pounds of materials in production. (Finished goods and work in process inventories are insignificant and can be ignored.) c. Worked 11,800 direct labor-hours at a cost of $17.00 per hour. d. Incurred variable manufacturing overhead cost totaling $18,290 for the month. A total of 5,900 machine-hours was recorded. It is the company's policy to close all variances to cost of goods sold on a monthly basis. Required: 1. Compute the following variances for June: a. Materials price and quantity variances. b. Labor rate and efficiency variances. c. Variable overhead rate and efficiency variances. 2. Summarize the variances that you computed in (1) above by showing the net overall favorable or unfavorable variance for the month. Complete this question by entering your answers in the tabs below. Required 1 Required 2 1a. Compute the following variances for June, materials price and quantity variances. 1b. Compute the following variances for June, labor rate and efficiency variances. 1c. Compute the following variances for June, variable overhead rate and efficiency variances. (Do not round your 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.) 1a. Material price variance 1a. Material quantity variance 1b. Labor rate variance 1b. Labor efficiency variance 1c. Variable overhead rate variance 1c. Variable overhead efficiency variance < Required 1 Required 2 > Show less Required 1 Required 2 Summarize the variances that you computed in (1) above by showing the net overall favorable or unfavorable variance for the month. (Indicate the effect of variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input the amount as positive value.) Net variance

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To compute the variances well use the given information and the standard costs 1a Materials Price Variance Actual Quantity Purchased 60000 pounds Actu... View the full answer