Milberg Co. uses absorption costing and standard costing to improve cost control.

In 2016, the total budgeted overhead rate was $1.55 per direct labour hour. When preparing the budget, Milberg expected a monthly activity level of 10,000 direct labour hours. The monthly variable overhead cost budgeted for this level of activity was $9,500.

The following data on actual results are provided for the month of November 2016.

Materials purchased	20,000 units
Direct labour costs incurred	$36,000
Total of direct labour rate and efficiency variances	$500 F
Actual wage rate ($0.20 less than standard)	$4.80
Underapplied variable overhead costs	$1,065 U
Total underapplied fixed and variable overhead costs	$2,256 U
Materials price variance	$200 F
Materials efficiency variance	$610 F
Price of purchased materials	$0.60 per unit
Materials used	15,000 units

Instructions

Identify and calculate as many different variances as you can for 2016.

(adapted from CGA-Canada, now CPA Canada)

LPV=$ 1500 F