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Becton Labs, Inc., produces various chemical compounds for industrial use. One compound, called Fludex, is prepared using an elaborate distilling process. The company has developed standard costs for one unit of Fludex, as follows:

Help Sav ional Assignment Becton Labs, Inc, produces various chemical compounds for industrial use. One compound, called Fludex, is prepared using arn elaborate distiling process. The company has developed standard costs for one unit of Fludex, as follows: 125.00 per ounce$55-00 $15.00 per hour .50 oTS Direct labor Variable sanufacturing overhead Tetal standard cost per wnit 3.00 per hour During November, the following activity was recorded related to the production of Fludex was no beginning inventory of materialis; however, at the end of the month,2,750 ounces of material remained in Th company emeloys 25 leb tecohritao to wow n the production of Fiudex During Novembe they each d. Variable manufacturing overhead is assigned Inventory 110 hours at an average pay rate of $11.50 per hour during November totaled $2,400 ed to Fludex on the basis of direct labor-hours. Variable manufacturing overhead costs e. During November the company produced 4,100 units of ludex Required: 1 For direct materials: a. Compute the price and quantity variances b. The materials were purchased from a new supplier who is anxious to enter into a long-term purchase contract. Would recommend that the company sign the contract? 2. For direct labor a. Compute the rate and efficiency variances Iin the past, the 25 technicians employed in the production of Fludex consisted of 5 senior technicians and 20 assistants. During mber, the company experimented with fewer senior technicians and more assistants in order to reduce labor costs. Would you recommend that the new labor mix be continued? 20 a

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