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2. Basketballs (Standard Costs & Variances): Your company makes basketballs. Let’s say the company produced 10,000...

2. Basketballs (Standard Costs & Variances): Your company makes basketballs. Let’s say the company produced 10,000 balls in June. The balls each take 6 ounces of rubber (vegetarian) to produce. Rubber is expected to cost $1.40 per ounce. You bought and used 70,000 ounces of rubber in June at a cost of $87,500-

Questions:

a) What is the standard [expected] cost of rubber for the 10,000 balls?

b) What is the actual cost of rubber, per ounce, that you bought and used in June?

c) What is the material price variance?

d) What is the material quantity variance?

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