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Stratton, Ltd. manufactures shirts, which it sells to customers for embroidering with various slogans and emblems. The standard cost card for the shirts is as follows.

Standard PriceStandard QuantityStandard CostDirect materials$4 per yard1.50yards$6.00Direct labor$12 per DLH0.50DLH6.00Variable overhead$4 per DLH0.50DLH2.00Fixed overhead$6 per DLH0.50DLH3.00$17.00

Sandy Robison, operations manager, was reviewing the results for November when he became upset by the unfavorable variances he was seeing. In an attempt to understand what had happened, Sandy asked CFO Suzy Summers for more information. She provided the following overhead budgets, along with the actual results for November.

The company purchased and used 80,200 yards of fabric during the month. Fabric purchases during the month were made at $3.90 per yard. The direct labor payroll ran $319,725, with an actual hourly rate of $12.25 per direct labor hour. The annual budgets were based on the production of 50,000 shirts, using 250,000 direct labor hours. Though the budget for November was based on 50,000 shirts, the company actually produced 52,000 shirts during the month.

Variable Overhead BudgetAnnual BudgetPer ShirtNovemberActualIndirect material$450,000$0.90$49,200Indirect labor300,0000.6031,400Equipment repair200,0000.4020,500Equipment power50,0000.106,900Total$1,000,000$2.00$108,000

Fixed Overhead BudgetAnnual BudgetNovemberActualSupervisory salaries$260,000$22,000Insurance350,00027,500Property taxes80,0006,500Depreciation320,00026,000Utilities210,00020,300Quality inspection280,00025,000Total$1,500,000$127,300

(a)Calculate the direct materials price and quantity variances for November.(If variance is zero, select "Not Applicable" and enter 0 for the amounts.)

Direct material price variance$

Not Applicable

Unfavorable

Favorable

Direct material quantity variance$

Not Applicable

Unfavorable

Favorable

(b)Calculate the direct labor rate and efficiency variances for November.(Round answers to 0 decimal places, e.g. 125. If variance is zero, select "Not Applicable" and enter 0 for the amounts.)

Direct labor rate variance$

Not Applicable

Unfavorable

Favorable

Direct labor efficiency variance$

Not Applicable

Favorable

Unfavorable

(c)Calculate the variable overhead spending and efficiency variances for November.(Round answers to 0 decimal places, e.g. 125. If variance is zero, select "Not Applicable" and enter 0 for the amounts.)

Variable overhead spending variance$

Not Applicable

Unfavorable

Favorable

Variable overhead efficiency variance$

Favourable

Not Applicable

Unfavourable

(d)Calculate the fixed overhead spending variance for November.(Round answer to 0 decimal places, e.g. 125. If variance is zero, select "Not Applicable" and enter 0 for the amounts.)

Fixed overhead spending variance$

Not Applicable

Unfavorable

Favorable

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