a. compute material price variance and determine if its is favorable or unfavorable.

b. compute material usage variance and determine if its favorable or unfavorable .

The two subsequent questions rely on the information below: Direct materials: 2.5 lbs./unit at a cost of $3/lb. Direct labor: 3 hrs./unit at a cost of $15/hr. At the end of the year, the following information is available: Direct materials purchased: 50,000 lbs. at a cost of $175,000 Direct materials used: 48,000 lbs. Direct labor cost: $360,000 Production: 25,000 units The company computes variances as early as possible