Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis Mackinaw Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 5,200 units of product were as follows: Standard Costs Actual Costs Direct materials 6,800 lb. at $5.80 6,700 lb. at $5.70 Direct labor 1,300 hrs. at $16.90 1,330 hrs. at $17.20 Factory overhead Rates per direct labor hr., based on 100% of normal capacity of 1,360 direct labor hrs. $5,790 variable cost Variable cost, $4.50 Fixed cost, $7.10 $9,656 fixed cost Each unit requires 0.25 hour of direct labor. Required: a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Direct materials price variance -670 Favorable Direct materials quantity variance X Favorable Total direct materials cost variance X Favorable b. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Direct labor rate variance 399 Unfavorable Direct labor time variance X Unfavorable Total direct labor cost variance X Unfavorable c. Determine variable factory overhead controllable variance, the fixed factory overhead volume variance, and total factory overhead cost variance. Enter a favorable vanance as a negative number using a minus sign and an unfavorable variance as a positive number. Variable factory overhead controllable variance X Favorable Fixed factory overhead volume variance X Unfavorable Total factory overhead cost variance $ X Unfavorable Feedback Check My Work Unfavorable variances can be thought of as increasing costs (a debit). Favorable variances can be thought of as decreasing costs (a credit). The variable factory overhead controllable variance is the difference between the actual variable overhead costs and the budgeted variable overhead for actual production. The fixed factory overhead volume variance is the difference between the budgeted fixed overhead at 100% of normal capacity and the standard fixed overhead for the actual units produced