Pick the Correct Answer. Show work where needed. 12. The sources of quantitative standards include: a. historical experience. b. engineering studies. c. input from operating personnel. d. historical experience, engineering studies and input from operating personnel. e. none of these answers. 13. Standard cost systems are adopted a. to improve planning and control. b. to facilitate product costing. c. to enhance the operational control of firms that emphasize continuous improvement. d. to improve planning and control, and to facilitate product costing. e. for all of these reasons. 14. Caballero Corporation produces high-quality leather saddles. The company has a standard cost system and has set the following standards for materials and labor: Leather (20 strips @ $15) $300 Direct labor (15 hours @ $15) 225 Total prime cost $525 During the year Caballero produced 150 saddles. Actual leather purchased was 3,100 strips, at $12 per strip. There were no beginning or ending inventories of leather. Actual direct labor was 2,500 hours at $16 per hour. Compute the costs of leather and direct labor that should have been incurred for the production of 150 saddles. a. $36,000 and $36,000 b. $46,500 and $37,500 c. $37,200 and $40,000 d. $45,000 and $33,750 15. Calculate the labor rate variance and the labor efficiency variance, respectively. a. $2,500 U and $3,750 U b. $2,500 F and $3,750 F c. $2,250 U and $4,000 U d. $2,250 F and $4,000 F 16. Compute the total budget variances for materials and labor, respectively. a. $7,800 U and $6,250 F b. $7,800 F and $6,250 U c. $1,500 U and $3,750 U d. $1,500 F and $3,750 F 17. Compute the materials price variance and the materials usage variance, respectively. a. $9,300 F and $1,500 U b. $9,300 U and $1,500 F c. $9,000 F and $1,200 U d. $9,000 U and $1,200 F 18. Perfect Builders makes all sorts of moldings. Its standard quantity of material allowed is 1 foot of wood per 1 foot of molding at a standard price of $2.00 per foot. During August, it purchased 500,000 feet of wood at a cost of $1.90 per foot, which produced only 499,000 feet of molding. Calculate the materials price variance and the materials usage variance, respectively. a. $50,000 F and $2,000 U b. $49,900 U and $2,000 F c. $50,000 F and $1,900 U d. $49,900 F and $1,900 U