Mickley Corporation produces two products, Alpha6s and Zeta7s, which pass through two operations, Sintering and Finishing....
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Mickley Corporation produces two products, Alpha6s and Zeta7s, which pass through two operations, Sintering and Finishing. Each of the products uses two raw materials-X442 and Y661. The company uses a standard cost system, with the following standards for each product (on a per unit basis): Product Alpha6 Zeta7 Raw Material X442 2.0 kilos. Y661 1.5 liters Standard Labor Time Sintering Finishing 0.10 hours 0.30 hours 1.00 hours 0.80 hours 3.0 kilos. 4.5 liters Information relating to materials purchased and materials used in production during May follows: Purchase Cost Material X442 Purchases 14,200 kilos Y661 15,200 liters $ 55,380 $ 22,800 Standard Price. $ 3.70 per kilo Used in Production $ 1.60 per liter 8,700 kilos. 13,200 liters The following additional information is available: a. The company recognizes price variances when materials are purchased. b. The standard labor rate is $22.00 per hour in Sintering and $18.10 per hour in Finishing. c. During May, 1,200 direct labor-hours were worked in Sintering at a total labor cost of $27,240, and 2,870 direct labor-hours were worked in Finishing at a total labor cost of $60,270. d. Production during May was 1,700 Alpha6s and 1,800 Zeta7s. Required: 1. Complete the standard cost card for each product, showing the standard cost of direct materials and direct labor. 2. Compute the materials price and quantity variances for each material. 3. Compute the labor rate and efficiency variances for each operation. Mickley Corporation produces two products, Alpha6s and Zeta7s, which pass through two operations, Sintering and Finishing. Each of the products uses two raw materials-X442 and Y661. The company uses a standard cost system, with the following standards for each product (on a per unit basis): Product Alpha6 Zeta7 Raw Material X442 2.0 kilos. Y661 1.5 liters Standard Labor Time Sintering Finishing 0.10 hours 0.30 hours 1.00 hours 0.80 hours 3.0 kilos. 4.5 liters Information relating to materials purchased and materials used in production during May follows: Purchase Cost Material X442 Purchases 14,200 kilos Y661 15,200 liters $ 55,380 $ 22,800 Standard Price. $ 3.70 per kilo Used in Production $ 1.60 per liter 8,700 kilos. 13,200 liters The following additional information is available: a. The company recognizes price variances when materials are purchased. b. The standard labor rate is $22.00 per hour in Sintering and $18.10 per hour in Finishing. c. During May, 1,200 direct labor-hours were worked in Sintering at a total labor cost of $27,240, and 2,870 direct labor-hours were worked in Finishing at a total labor cost of $60,270. d. Production during May was 1,700 Alpha6s and 1,800 Zeta7s. Required: 1. Complete the standard cost card for each product, showing the standard cost of direct materials and direct labor. 2. Compute the materials price and quantity variances for each material. 3. Compute the labor rate and efficiency variances for each operation.
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