Data for Variance Analysis:
	Budgeted (Standard) Hours/Qty	Budgeted (Standard) Rate	Actual Hours/Qty	Actual Rate
Labor
Materials
Variances for Collar Sales
			Variance	Favorable/ Unfavorable
Direct Labor Time Variance
(Actual Hours - Standard Hours) x Standard Rate			$ -
Direct Labor Rate Variance
(Actual Rate - Standard Rate) x Actual Hours			$ -
Direct Materials Quantity/Efficiency Variance
(Actual Quantity - Standard Quantity) x Standard Price			$ -
Direct Materials Price Variance
(Actual Price - Standard Price) x Actual Quantity			$ -

Variance

At the end of the month, you find that the labor and materials spent on manufacturing collars were different from what you estimated:

• The collar maker had to work nine hours a day instead of eight due to an increased demand for collars.
• Because of the increased demand, the hourly rate you paid your employee for making the collars increased to $16.50.
• An increase in the cost of raw material led the direct material cost per collar to increase to $10.
• However, you also made and sold 60 more collars than you expected to sell in the month.

You now need to determine the variance in the materials and labor cost from what you estimated in Milestone Two based on the market research data.

Milestone Two: Market Research Data

You have conducted some market research for style and size of products you want to use to launch your business. The market research has indicated the following sales price ranges will be optimal for your area depending on style of products you choose to sell:

• Collars
  • With pricing at $28 per collar, you can expect to sell 20 collars per day
• Leashes
  • With pricing at $30 per leash, you can expect to sell 18 leashes per day.
• Harnesses
  • With pricing at $35 per harness, you can expect to sell 20 harnesses per day.

Salary and Hiring Data

• One collar maker, who will be paid $16.00 per hour and work 40 hours per week
• One leash maker, who will be paid $16.00 per hour and work 40 hours per week
• One harness maker, who will be paid $17.00 per hour and work 40 hours per week
• One receptionist, who will be paid $15.00 per hour and work 30 hours per week