Exercise 10-7 (Algo) Direct Materials Variances [LO10-1]

Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below:

	Standard Quantity or Hours		Standard Price or Rate		Standard Cost
Direct materials	5.60	pounds	$ 3.00	per pound	$ 16.80
Direct labor	0.40	hours	$ 7.00	per hour	$ 2.80

During the most recent month, the following activity was recorded:

Ten thousand eight hundred pounds of material were purchased at a cost of $2.90 per pound.

The company produced only 1,080 units, using 9,720 pounds of material. (The rest of the material purchased remained in raw materials inventory.)

532 hours of direct labor time were recorded at a total labor cost of $6,384.

Required:

Compute the materials price and quantity variances for the month.