Direct materials (resin). 9 pounds per pot at a cost of $5.00 per pound 3.0 hours at a cost of $18.00 per hour Direct labor Standard variable manufacturing overhead rate Budgeted fixed manufacturing overhead Standard fixed MOH rate $8.00 per direct labor hour $41,900 $9.00 per direct labor hour (DLH) Center Ware allocated fixed manufacturing overhead to production based on standard direct labor hours. Last month, the company reported the following actual results for the production of 1,700 flower pots: Direct materials Purchased 16,850 pounds at a cost of $5.20 per pound; used 16,150 pounds to produce 1,700 pots Direct labor . Worked 3.3 hours per flower pot (5,610 total DLH) at a cost of $17.00 per hour Actual variable manufacturing overhead ..... $8.30 per direct labor hour for total actual variable manufacturing overhead of $46,563 Actual fixed manufacturing overhead $41,700 Standard fixed manufacturing overhead allocated based on actual production $45,900 Center Ware is a manufacturer of large flower pots for urban settings. The company has these standards: (Click the icon to view the standards.) (Click the icon to view the actual results.) Requirements 1. Compute the direct material price variance and the direct material quantity variance. 2. Who is generally responsible for each variance? 3. Interpret the variances. Requirement 1. Compute the direct material price variance and the direct material quantity variance. (Enter the variances as positive numbers. Enter currency amounts in the formula to the nearest cent and then round the final variance amount to the nearest whole dollar. Label the variance as favorable (F) or unfavorable (U). Abbreviations used: DM = Direct materials) First determine the formula for the price variance, then compute the price variance for direct materials. DM price variance x Determine the formula for the quantity variance, then compute the quantity variance for direct material. x DM quantity variance Requirement 2. Who is generally responsible for each variance? The department is responsible for the materials price variance. The materials quantity variance. department is responsible for the Requirement 3. Interpret the variances. the The materials price variance means that the actual price Chic Ceramics' personnel paid for resin standard budgeted price for resin. resin than they should have to The materials quantity variance means that Chic Ceramics' employees used produce 1,700 pots