Hillcrest manufactures a variety of clothing. The company has a single line of blouses that it produces in jobs, with each job representing an order from a customer. As a job is completed, the customer's store label is attached to the blouses before shipment. -- Customers order blouses in "lots", where each "lot" contains 12 blouses. Thus, if a customer orders a shipment of 10 lots, they are ordering 120 blouses. -- Hillcrest has a standard cost system and has established the following direct material and direct labor standards for one "lot" of blouses.

Standard for 1 "Lot of Blouses	Standard Quantity	Standard Price or Rate	Standard Cost
Direct Materials	32 Yards	$2.40 per Yard	$76.80
Direct Labor	6 Hours	$7.50 per Hour	$45.00
			$121.80

During October, Hillcrest worked on three blouse orders. The company's job cost records for the month reveal the following.

Job Number	# of Lots per Job	Materials Used (yards)	Hours Worked
48	1,500	48,300	8,900
49	950	30,140	6,130
50	2,100	67,250	10,270

The following additional information is available:

a) Hillcrest purchased 180,000 yards of material during October at a cost of $424,800

b) Direct labor cost incurred during the month for production of blouses amounted to $192,280

c) There was no work in process inventory on October 1. During October, jobs 48 and 49 were completed and shipped. Job 50 was 100% complete as to materials but only 80% complete as to labor.

Required:

1) Compute the materials price variance during October

2) Determine the materials quantity variance for October in both yards and dollars:

a. For each job worked on during the month, and

b. For the company as a whole

3) Compute the labor rate variance for October

4) Determine the labor efficiency variance for the month in both hours and dollars:

a. For each job worked on during the month

b. For the company as a whole

5) Determine the total Direct Labor Spending Variance

6) In what situations might it be better to express variances in units (hours, yards, and so on) rather than in dollars? In dollars rather than in units? Explain.