A:

Four Seasons Industries has established direct labor performance standards for its maintenance and repair shop. However, some of the labor records were destroyed during a recent fire. The actual hours worked during August were 1,500, and the total direct labor budget variance was $780 unfavorable. The standard labor rate was $9.60 per hour, but recent resignations allowed the firm to hire lower-paid replacement workers for some jobs, and this produced a favorable rate variance of $2,100 for August.

Required:

1. Calculate the actual direct labor rate paid per hour during August. (Do not round intermediate calculations. Round your answer to 1 decimal place.)
2. Calculate the dollar amount of the direct labor efficiency variance for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)
3. Calculate the standard direct labor hours allowed for the actual level of activity during August. (Hint: Use the formula for the quantity variance and solve for the missing information.

B:

Oakwood Inc. manufactures end tables, armchairs, and other wood furniture products from high-quality materials. The company uses a standard costing system and isolates variances as soon as possible. The purchasing manager is responsible for controlling direct material price variances, and production managers are responsible for controlling usage variances. During November, the following results were reported for the production of American Oak armchairs:

Units produced	1,640	armchairs
Direct materials purchased	19,000	board feet
Direct materials issued into production	17,010	board feet
Standard cost per unit (12 board feet $8.6)	$103.2	per unit produced
Purchase price variance	$2,800	unfavorable

Required:

1. Calculate the actual price paid per board foot purchased. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
2. Calculate the standard quantity of materials allowed (in board feet) for the number of units produced.
3. Calculate the direct materials usage variance. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)
4. The purchasing manager may have purchased higher-than-standard quality raw material inputs is the most likely explanation for the price and usage variances.