2.

Puvo, Inc., manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard cost system and has established the following standards for one unit of product: Standard Price or Standard Standard Quantity 6.70 pounds Rate Cost $ 3.35 Direct materials $ .50 per pound $42.50 per hour $ 9.40 per hour Direct labor 0.40 hours $17.00 $ 3.76 Variable manufacturing overhead 0.40 hours During March, the following activity was recorded by the company: The company produced 3,300 units during the month. A total of 20,300 pounds of material were purchased at a cost of $14,480. There was no beginning inventory of materials on hand to start the month; at the end of the month, 4,520 pounds of material remained in the warehouse. During March, 1,180 direct labor-hours were worked at a rate of $39.50 per hour. Variable manufacturing overhead costs during March totaled $14,961. The direct materials purchases variance is computed when the materials are purchased. The variable overhead rate variance for March is: Majer Corporation makes a product with the following standard costs: Standard Standard Quantity Standard Price or Cost Per or Hours Unit Rate Direct materials 6.5 ounces $ 2.00 per ounce $13.00 $ 18.00 per hour Direct labor 0.8 hours $14.40 $ 1.60 Variable overhead 0.8 hours 2.00 per hour The company reported the following results concerning this product in February Originally budgeted output Actual output Raw materials used in production 4,600 units 5,300 units 30,500 ounces 2,110 hours Actual direct labor-hours Purchases of raw materials 32,900 ounces $ 97.10 per ounce $ 87.60 per hour 6.10 per hour Actual price of raw materials Actual direct labor rate Actual variable overhead rate The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased The variable overhead efficiency variance for February is