Epley Corporation makes a product with the following standard costs:

	Standard Quantity or Hours	Standard Price or Rate
Direct materials	8.5 pounds	$8.0 per pound
Direct labor	0.8 hours	$29.00 per hour
Variable overhead	0.8 hours	$13.50 per hour

In July the company produced 3,400 units using 13,600 pounds of the direct material and 2,840 direct labor-hours. During the month, the company purchased 14,360 pounds of the direct material at a cost of $35,100. The actual direct labor cost was $81,951 and the actual variable overhead cost was $36,748.

The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.

The labor rate variance for July is:

$409 F

$409 U

$3,071 U

$3,071 F