(Direct material and direct labor variances) In December, Billie Parcells, pres¬ ident of Parcells Co., received the following information from Joe Gibbs, the new controller, in regard to November production of gym bags:

Ms. Parcells asked Mr. Gibbs to provide her the following information:

a. Standard quantity of material allowed for November production.

b. Standard direct labor hours allowed for November production.

c. Material price variance.

Labor efficiency variance.

e. Standard prime (direct material and direct labor) cost to produce one bag.

f. Actual cost to produce one gym bag in November.
g. An explanation for the difference between standard and actual cost. Be sure that the explanation is consistent with the pattern of the variances.LO.1

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November production Actual cost of material purchased and used Standard material allowed Material quantity variance Actual hours worked Standard labor time per gym bag Labor rate variance Standard labor rate per hour. Standard price per yard of material 2,400 gym bags $21,875 0.5 square yard per bag $800 U 5,000 hours 2 hours $650 F $17 $16