Chapter 11 - Assignment 1 Materials and Labor Variances Welch Company budgeted the following cost standards for the current year: Direct materials - 1.40 pounds per unit @ $1.50 per pound Direct labor -0.75 hours per unit @ $6 per hour Actual production and costs were as follows: Units produced = 2,800 Direct materials used - 4,500 lbs. Direct materials purchased = 5,000 lbs. @ a cost of $5,850 Direct labor incurred - 2,000 hours at a cost of $13,000 a) The material price variance for materials purchased was? b) The material efficiency (usage) variance was? c) The labor price variance was d) The labor efficiency (usage) variance was Chapter 10 - Assignment 1 Ray Company's projected sales budget for the next four months is as follows: Units January 70,000 February 90,000 March 55,000 April 65,000 Beginning inventory for the year is 21,000 units. Ending inventory for each month should be 30% of the next month's sales. Additionally, 3 pounds of raw material are used to make each unit at a cost of $5 per pound. Ray has a policy of keeping 20% of the following month's budgeted direct material needs on hand at the end of each month. a) How many units should the company produce in January? b) How much should Ray budget for raw material purchases in February