ARE THE ANSWERS CORRECT?

Clarissa McWhirter, vice-president of Cyprus Company, was pleased to see a small variance on the income statement after the trouble the company had been having in controlling manufacturing costs. She noted that the $22,810 overall manufacturing variance reported last period was well below the 3% limit that had been set for variances. The company produces and sells a single product. The standard cost card for the product follows Standard Cost Card-Per Unit Direct materials, 4 metres at $3.10 per metre Direct labour, 1.5 direct labour-hours at $12.5 per direct labour-hour Variable overhead, 1.5 direct labour-hours at $2.1 per direct labour-hour Fixed overhead, 1.5 direct labour-hours at $5 per direct labour-hour 12.40 18.75 3.15 7.50 41.80 Standard cost per unit The following additional information is available for the year just completed a. The company manufactured 26,000 units of product during the year. b. A total of 103,200 metres of material was purchased during the year at a cost of $3.15 per metre. All of this material was used to manufacture the 26,000 units. There were no beginning or ending inventories for the year c. The company worked 40,600 direct labour-hours during the year at a cost of $12.40 per hour d. Overhead cost is applied to products on the basis of standard direct labour-hours. Data relating to manufacturing overhead costs follow: Denominator activity level (direct labour-hours) Budgeted fixed overhead costs (from the flexible budget) Actual fixed overhead costs Actual variable overhead costs 39,200 196, 000 $ 194,600 $ 86,490 Required: 1. Compute the direct materials price and quantity variances for the year. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) Materials price variance 5,160 Materials quantity variance $ 2,48oF 2. Compute the direct labour rate and efficiency variances for the year. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) Labour rate variance $4,060F Labour efficiency variance20,000