Please answer this question in its entirety. Reflect on the image to provide specific and easy to understand answers. Problem 9-24 (Algo) Comprehensive Variance Analysis [LO9-4, LO9-5, LO9-6]Marvel Parts, Incorporated, 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 uses a standard cost system for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,065 hours each month to produce 2,130 sets of covers. The standard costs associated with this level of production are: TotalPer Set of CoversDirect materials$ 35,358$ 16.60Direct labor$ 8,5204.00Variable manufacturing overhead (based on direct labor-hours)$ 3,1951.50 $ 22.10 During August, the factory worked only 1,050 direct labor-hours and produced 2,700 sets of covers. The following actual costs were recorded during the month: TotalPer Set of CoversDirect materials (6,000 yards)$ 43,740$ 16.20Direct labor$ 11,3404.20Variable manufacturing overhead$ 5,6702.10 $ 22.50 At standard, each set of covers should require 2.0 yards of material. All of the materials purchased during the month were used in production. Required:1. Compute the materials price and quantity variances for August.2. Compute the labor rate and efficiency variances for August.3. 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). Input all amounts as positive values.) Required:1. Compute the materials price and quantity variances for August.2. Compute the labor rate and efficiency variances for August.3. 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., zerovariance). Input all amounts as positive values.)1. Materials price variance1. Materials quantity variance2. Labor rate variance2. Labor efficiency variance3. Variable overhead rate variance3. Variable overhead efficiency variance

Labor rate variance refers to the concept of determining the gap between the the expected labor rate…

Answered: Problem 9-24 (Algo) Comprehensive…

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter8: Standard Cost Accounting—materials, Labor, And Factory Overhead

Section: Chapter Questions

Problem 23E: (Appendix) Calculating factory overhead: three variances Using the data given in E8-17, calculate...

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Problem 9-24 (Algo) Comprehensive Variance Analysis [LO9-4, LO9-5, LO9-6]

Marvel Parts, Incorporated, 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 uses a standard cost system for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,065 hours each month to produce 2,130 sets of covers. The standard costs associated with this level of production are:

	Total	Per Set of Covers
Direct materials	$ 35,358	$ 16.60
Direct labor	$ 8,520	4.00
Variable manufacturing overhead (based on direct labor-hours)	$ 3,195	1.50
		$ 22.10

During August, the factory worked only 1,050 direct labor-hours and produced 2,700 sets of covers. The following actual costs were recorded during the month:

	Total	Per Set of Covers
Direct materials (6,000 yards)	$ 43,740	$ 16.20
Direct labor	$ 11,340	4.20
Variable manufacturing overhead	$ 5,670	2.10
		$ 22.50

At standard, each set of covers should require 2.0 yards of material. All of the materials purchased during the month were used in production.

Required:

1. Compute the materials price and quantity variances for August.

2. Compute the labor rate and efficiency variances for August.

3. 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). Input all amounts as positive values.)

Required:
1. Compute the materials price and quantity variances for August.
2. Compute the labor rate and efficiency variances for August.
3. 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). Input all amounts as positive values.)
1. Materials price variance
1. Materials quantity variance
2. Labor rate variance
2. Labor efficiency variance
3. Variable overhead rate variance
3. Variable overhead efficiency variance

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

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