(Direct material variances) Leisure Furniture makes wrought iron table and chair sets. During April 1996, the purchasing agent bought 17,600 pounds of scrap iron at $.89 per pound. Each set requires a standard quantity of 70 pounds at a standard cost of $.85 per pound. During April, the company used 16,940 pounds and produced 250 sets.

a. For April, compute the direct material price variance (based on the quantity purchased) and the direct material quantity variance.

b. Identify the titles of individuals in the firm who would be responsible for each of the variances.

c. Identify some potential explanations for the variances computed in part a.

LO1