A Chemical Company Produces a Product Used by Manufacturers of Plastics.Two

Essay

A chemical company produces a product used by manufacturers of plastics.Two basic chemicals go into this product.The standards for one-liter of this product are:
Chemical 1: 800 ml.@ $50 per liter
Chemical 2: 200 ml.@ $200 per liter
During the last period,5,000 liters of the solvent were produced and the company purchased the following amounts of each chemical:
Chemical 1: 5,400 liters @ $59.00 per liter
Chemical 2: 900 liters @ $225.00 per liter
Because these chemicals are volatile,the company uses them immediately upon purchase,so there are no beginning and ending inventories.Required:
(Be sure to indicate whether the variance is favorable or unfavorable. )
a.Compute the direct material price variances.b.Compute the direct material efficiency variances.c.Compute the direct material mix variances.d.Compute the direct material yield variances.