Question:
(Material Variances) Creature Comforts makes beds for cat and dogs. The beds are made from flannel fabric and cotton stuffing. In June, the company purchased 1,000 metres of flannel at a price of $5 per metre and 700 kg of cotton stuffing at a price of $2 per kg. During June, 750 kg of cotton and 975 metres of flannel were used in the production of 390 beds (190 dog beds and 200 cat beds). Each type of bed requires the following:
|
Dog Bed
|
Cat Bed
|
|
Metres of flannel
|
3
|
1.5
|
|
Kg of cotton
|
2
|
1.5
|
|
Price of flannel
|
$5
|
$5
|
|
Price of cotton
|
$2
|
$2
|
Determine the materials price and efficiency variances for the company.