Boat Guard, which used a standard cost accounting system, manufactured $210,000$ boat fenders during the year, using $1,780,000$ feet of extruded vinyl purchased at $$1\mathrm{.}30$ per foot. Production required $4,900$ direct labor hours that cost $$13\mathrm{.}00$ per hour. The materials standard was $8$ feet of vinyl per fender at a standard cost of $$1\mathrm{.}40$ per foot. The labor standard was $0\mathrm{.}024$ direct labor hour per fender at a standard cost of $$12\mathrm{.}00$ per hour.

Read the requirements.

Requirement $1.$ Compute the price and quantity variances for direct materials. Compute the rate and efficiency variances for direct labor. $($Enter the variances as positive numbers. Enter currency amounts to the nearest cent and your answers to the nearest whole dollar. Label the variances as favorable $($F$)$ or unfavorable $($U$).$ Abbreviations used: DM $=$ Direct materials, DL $=$ Direct labor.$)$

Begin with the variances for direct materials. First, determine the formula for the direct materials price variance, then compute the price variance for direct materials. $($Assume that the quantity of materials purchased is equal to the quantity of materials used.$)$

DM price variance