Vet-Pro, Inc., produces a veterinary grade anti-anxiety mixture for pets with behavioral problems. Two chemical solutions, Aranol and Lendyl, are mixed and heated to produce a chemical that is sold to companies that produce the anti-anxiety pills. The mixture is produced in batches and has the following standards: Direct Material Standard Mix Standard Unit Price Standard Cost Aranol 3,000 gallons $4.00 per gallon $ 13,000 Lendyl 17,000 6.00 102,000 Total 20,000 gallons $114,000 Yield 16,000 gallons During March, the following actual production information was provided: Direct Material Actual Mix Aranol 60,000 gallons Lendyl 140,000 Total 200,000 gallons Yield 166,000 gallons Vet-Pro, Inc., also uses two different types of direct labor in producing the anti-anxiety mixture: mixing and drum-filling labor (the completed product is placed into 50-gallon drums). For each batch of 20,000 gallons of direct materials input, the following standards have been developed for direct labor: Direct Labor Type Mix SP Standard Cost Mixing 2,000 hrs. $15.00 $30,000 Drum filling 1,200 9.40 11,280 Total 3,200 hrs. $41,280 Yield 16,000 gallons The actual direct labor hours used for the output produced in March are also provided: Direct Labor Type Mix Mixing 17,000 hrs. Drum filling 13,000 Total 30,000 hrs. Yield 158,000 gallons Required: 1. Compute the direct labor mix and yield variances. (Round standard price of yield to four significant digits and mix proportion to three significant digits. Use the rounded numbers in the subsequent computations.) Mix variance $fill in the blank Yield variance $fill in the blank 2. Compute the total direct labor efficiency variance. $fill in the blank

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Vet-Pro, Inc., produces a veterinary grade anti-anxiety mixture for pets with behavioral problems. Two chemical solutions, Aranol and Lendyl, are mixed and heated to produce a chemical that is sold to companies that produce the anti-anxiety pills. The mixture is produced in batches and has the following standards:

Direct Material	Standard Mix	Standard Unit Price	Standard Cost
Aranol	3,000	gallons	$4.00	per gallon	$	13,000
Lendyl	17,000		6.00			102,000
Total	20,000	gallons				$114,000
Yield	16,000	gallons

During March, the following actual production information was provided:

Direct Material	Actual Mix
Aranol	60,000	gallons
Lendyl	140,000
Total	200,000	gallons
Yield	166,000	gallons

Vet-Pro, Inc., also uses two different types of direct labor in producing the anti-anxiety mixture: mixing and drum-filling labor (the completed product is placed into 50-gallon drums). For each batch of 20,000 gallons of direct materials input, the following standards have been developed for direct labor:

Direct Labor Type	Mix	SP	Standard Cost
Mixing	2,000	hrs.	$15.00	$30,000
Drum filling	1,200		9.40	11,280
Total	3,200	hrs.		$41,280
Yield	16,000	gallons

The actual direct labor hours used for the output produced in March are also provided:

Direct Labor	Type Mix
Mixing	17,000	hrs.
Drum filling	13,000
Total	30,000	hrs.
Yield	158,000	gallons

Required:

1. Compute the direct labor mix and yield variances. (Round standard price of yield to four significant digits and mix proportion to three significant digits. Use the rounded numbers in the subsequent computations.)

Mix variance	$fill in the blank
Yield variance	$fill in the blank

2. Compute the total direct labor efficiency variance.
$fill in the blank

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