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Pato Company produces leather sandals. The company employs a standard costing system and has the following standards in order to produce one pair of sandals:
Pato Company produces leather sandals. The company employs a standard costing system and has the following standards in order to produce one pair of sandals: TOTAL # OF UNITS=4,328 standard quantity standard price direct materials 2 leather strips ?? per strip direct labor 2.5 hours $10 per hour variable overhead 2.5 hours ?? per hour During May, Pato purchased leather strips at a total cost of $124,520 and had direct labor totaling $117,100. During May, Pato used 18,790 leather strips in the production of sandals. Pato had no beginning inventories of any type for May. At May 31, Pato had 780 leather strips remaining in its direct materials inventory. Pato Company reported the following variances for May: Direct material price variance .............. $7,100 unfavorable Direct labor rate variance .................. $29,500 favorable Total direct labor variance ................. $8,900 unfavorable Variable overhead spending variance ......... $2,440 favorable Variable overhead efficiency variance ....... $34,560 unfavorable Calculate Pato's direct material quantity variance for May. IF THE VARIANCE IS FAVORABLE, place a minus sign in front of your answer (i.e., -5000). If the variance is UNFAVORABLE, simply enter your answer as a number (i.e., 5000).
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