Outdoor Outfit Company makes a variety of jogging suits. It had planned to sell 12,000 jogging suits for $140 each this year. The CEO of the company is concerned that the operating income for the year is less than budget. He realizes that fewer units were sold; however, he also knows they were able to switch to a cheaper supplier for fabric; and because of high unemployment were able to hire employees at a lower hourly rate. The standard input costs and qualitites used to prepare the budget are shown below. Futhermore, Outdoor Outfit Company does not maintain an inventory of these jogging suits. They are made in qualtities sufficient to fill orders only.

Standard cost for direct material input: $12 per yard

Standard quantity for direct material input: 3.5 yards per suit

Standard cost for direct labor input: $15 per hour

Standard quantity for direct labor input: 2 hours per suit

Budgeted variable overhead cost: $90,000

Budgeted fixed overhead cost: $66,000

Fixed and variable overhead are allocated based on direct labor hours

Records indicate 40,000 yards of fabric were purchased and used, and 25,000 direct labor hours were worked to produce and sell 10,000 suits.

Required:

Static Budget and Flexiable budget

1. Total Static budget variance

2. Sales volume variance

3. Direct materials price variance

4. Direct materials efficiency variance

5. Direct labor price variance

6. Direct labor efficiency variance

7. Variable overhead spending variance

8. Variable overhead efficiency variance

9. Fixed overhead spending variance

10. Production volume variance

List one possible reason for each unfavorable direct materials, direct labor, and overhead variances (other than price increased or usage increased).