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Miller Toy Company manufactures a plastic swimming pool at its Westwood Plant. The plant is experiencing problems. They had budgeted net operating of $36,000 while actual net income is $19,710. The $16,290 budget variance was driven by the difference in variable costs of goods sold which was budgeted at $180,000 but the actual incurred was $196,290. Janet Dunn, the general manager of the has been given instructions to get things under control. Upon reviewing the plant's income statement, Ms. Dunn has concluded the major problem lies in the variable cost of goods sold. She has been provided with the following standard cost per swimming pool:

	Standard	Standard Price	Standard
	Quantity or Hours	or Rate	Cost
Direct materials	3.0 pounds	$2.00 per pound	$6.00
Direct labor	0.8 hours	$6.00 per hour	4.80
Variable manufacturing overhead	0.4 hours	$3.00 per hour	1.20
			$12.00

During June, the plant produced 15,000 pools and incurred the following costs

Purchased 60,000 pounds of materials at a cost of $1.95 per pound

Used 49,200 pounds of materials in production.

Worked 11,800 direct labor-hours at a cost of $7.00 per hour.

Incurred variable manufacturing overhead totaling $18,290 for the month. A total of 5,900 machine-hours was recorded

a. Compute the materials price and quantity variances for June. Show your work and computations.

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