Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances. Requirement $2.$ Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances.

Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is

favorable $($F$)$ or unfavorable $($U$).($Abbreviations used: $AC=$ actual cost; $AQ=$ actual quantity; FOH$=$ fixed overhead; $SC=$ standard cost; $SQ=$ standard quantity.$)$ Requirements

What are the benefits of setting cost standards?

Calculate the direct materials cost variance and the direct materials efficiency

variance as well as the direct labor cost and efficiency variances.