Sommers Irrigation, Inc. is known throughout the world for its H2O-X high-capacity water pump, used in irrigation systems. The pump's standard cost is as follows. The company's predetermined fixed overhead rate is based on an expected capacity of 100,000 direct labor hours per month.

During the month of September, the company produced 22,000 of the 25,000 pumps that had been scheduled for production in the budget. The company used 382,000 pounds of material during September. The direct labor payroll for the month was $980,000 for 95,000 direct labor hours. Variable overhead costs were $725,000; fixed overhead costs were $575,000.
The company's purchasing agent signed a new supply contract that resulted in purchases of 500,000 pounds of direct materials at a total price of $3,300,000.
Required
Calculate Sommers' direct materials, direct labor, and overhead variances for September.

Transcribed Image Text:

Standard PriceStandard Quantity Standard Cost $7 per pound $12 per DLH Direct materials Direct labor Variable overhead$8per DLH Fixed overhead 15 pounds 4 DLH 4 DLH 4 DLH $105 48 32 24 $209 $6 per DLH