Materials and Labor Variances

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

Line Item Description	Cost
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:

1. Units produced: 400,000.
2. Materials purchased: 2,060,000 pounds @ $3.95.
3. Materials used: 2,100,000 pounds.
4. Direct labor: 825,000 hours @ $14.85.

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

material price variance = $

material usage variance = $

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

Labor rate variance = $

Labor efficiency variance = $