D Problem 23-4A Computing materials, labor, and overhead variances P3 P4 Trico Company set the following standard unit costs for its single product. $120 70 Direct materials (30 lbs. @ $4 per Ib.) Direct labor (5 hrs. @ $14 per hr.) Factory overhead-Variable (5 hrs. @ $8 per hr.) Factory overhead-Fixed (5 hrs. @ $10 per hr.) Total standard cost 40 50 $280 The predetermined overhead rate is based on a planned operating volume of 80% of the productive capacity of 60,000 units per quarter. The following flexible budget information is available. Page 905 Operating Levels 70% 80% 90% Production in units 42,000 48,000 54,000 Standard direct labor hours 210,000 240,000 270,000 Budgeted overhead Fixed factory overhead $2,400,000 $2,400,000 $2,400,000 Variable factory overhead $1,680,000 $1,920,000 $2,160,000 During the current quarter, the company operated at 90% of capacity and produced 54,000 units of product; actual direct labor totaled 265,000 hours. Units produced were assigned the following standard costs. Direct materials (1,620,000 Ibs. @ $4 per Ib.) $ 6,480,000 Direct labor (270,000 hrs. @ $14 per hr.) 3,780,000 Factory overhead (270,000 hrs. @ $18 per hr.) 4,860,000 Total standard cost $15,120,000 Actual costs incurred during the current quarter follow. Direct materials (1,615,000 Ibs. @ $4.10 per lb.) $ 6,621,500 Direct labor (265,000 hrs. @ $13.75 per hr.) 3,643,750 Fixed factory overhead costs 2,350,000 Variable factory overhead costs 2,200,000 Total actual costs $14,815,250 Required 1. Compute the direct materials cost variance, including its price and quantity variances. Check (1) Materials variances: Price, $161,500 U; Quantity, $20,000 F 2. Compute the direct labor cost variance, including its rate and efficiency variances. (2) Labor variances: Rate, $66,250 F; Efficiency, $70,000 F