Video Producers Manufactures Two Types of Videos: Regular and CD

Essay

Video Producers manufactures two types of videos: regular and CD.The regular tapes require 5 units of direct material X at a standard price of $2 per unit.The CDs require 2 units of direct material Y at a standard price of $3.During January the company purchased 9,000 units of X for $2.10 each and 3,600 units of Y at $3.20 each.January production used 8,800 units of X and 3,400 units of Y.Outputs of finished tapes was 1,750 of each type.Required:
Compute the price and efficiency variances for each material.For the rate variances use two different responsibility assumptions.First assume that rate variances are isolated at the time of purchase; second assume that the rate variances are isolated as materials are placed into production.The efficiency variances for each material are determined during production.