Direct Materials, Direct Labor, and Overhead Variances, Journal Entries Algers Company produces dry fertilizer. At the beginning of the year, Algers had the following standard cost sheet: Direct materials (5 lbs. @ $2.60) Direct labor (0.75 hr. @ $18.00) Fixed overhead (0.75 hr. @ $4.00) Variable overhead (0.75 hr. @ $3.00) Standard cost per unit $13.00 13.50 3.00 2.25 $31.75 Algers computes its overhead rates using practical volume, which is 54,000 units. The actual results for the year are as follows: a. Units produced: 53,000 b. Direct materials purchased: 274,000 pounds at $2.50 per pound c. Direct materials used: 270,300 pounds d. Direct labor: 40,100 hours at $17.95 per hour e. Fixed overhead: $161,700 f. Variable overhead: $122,000 Required: 1. Compute price and usage variances for direct materials. MPV $ 27,400 Favorable MUV $ 13,780 Unfavorable