Lodge Crab Cakes Ltd. has prepared the following standard costs per dozen crab cakes:

	Standard Quantity (or Hours)	Standard Price (or Rate)	Standard Cost per dozen crab cakes
Direct Materials (crab meat)	0.6 kg	$14.00 / kg	$8.40
Direct Labour	1.5 hours	$10.00 / hr	$15.00
Variable Overhead	1.5 hours	$3.00 / hr	$4.50
Total Standard Cost(per dozen crab cakes)			$27.90

The company allocates variable overhead based on direct labour hours. Last month, Lodge Crab Cakes Ltd. produced 2,000 dozen crab cakes and incurred the following actual costs:

Direct materials: Purchased 1,500 kg of crab meat at $13.50 per kilogram. 1,500 kg of crab meat were used in production of the 2,000 dozen cakes.

Direct labour: 3,200 hours worked, for a total cost of $35,200.

Variable overhead: Total cost was $8,400.

Required:

a) Calculate the direct materials price and quantity variances. Label your variances and indicate if favourable or unfavourable. (4 marks)

b) Calculate the direct labour rate and efficiency variances. Label your variances and indicate if favourable or unfavourable. (2 marks)

c) Calculate the variable overhead spending and variable overhead efficiency variances. Label your variances and indicate if favourable or unfavourable. (2 marks)