Materials and Labor Variances

At the beginning of the year, Craig Company had the following standard cost sheet for one of its plastic products:

Direct materials (5 lbs. @ $4.00)	$20.00
Direct labor (2 hrs. @ $15.00)	30.00
Standard prime cost per unit	$50.00

The actual results for the year are as follows:

Units produced: 360,000.

Materials purchased: 2,520,000 pounds @ $5.00.

Materials used: 2,124,000 pounds.

Direct labor: 684,000 hours @ $14.28.

Required:

1. Compute price and usage variances for materials. Enter amounts as positive numbers and select Favorable or Unfavorable.

Material price variance	$fill in the blank 1	FavorableUnfavorable
Material usage variance	$fill in the blank 3	FavorableUnfavorable

2. Compute the labor rate and labor efficiency variances. Enter amounts as positive numbers and select Favorable or Unfavorable.

Labor rate variance	$fill in the blank 5	FavorableUnfavorable
Labor efficiency variance	$fill in the blank 7	FavorableUnfavorable