1) The standard cost of product 777 includes 2.40 units of direct materials at $5.00 per unit. During August, the company bought 28,700 units of materials at $5.09 and used those materials to produce 12,300 units.
Compute the total, price, and quantity variances for materials.
Total materials variance$
Unfavorable Neither favorable nor unfavorable Favorable
Materials price variance$
Neither favorable nor unfavorable
Unfavorable Favorable
Materials quantity variance$
Unfavorable Neither favorable nor unfavorable Favorable
2) The standard cost of product 5252 includes 2.90 hours of direct labor at $14.00 per hour. The predetermined overhead rate is $22.00 per direct labor hour. During July, the company incurred 4,400 hours of direct labor at an average rate of $14.17 per hour and $80,800 of manufacturing overhead costs. It produced 1,500 units.
(a) Compute the total, price, and quantity variances for labor.
Neither favorable nor unfavorable Unfavorable Favorable
Favorable Neither favorable nor unfavorable Unfavorable
Neither favorable nor unfavorable Favorable Unfavorable
(b) Compute the total overhead variance.
Neither favorable nor unfavorable Unfavorable Favorable