Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 130,000 liters at a budgeted price of $300 per liter this year. The standard direct cost sheet for one liter of the preservative follows. (2 pounds e $19) (0.5 hours e $54) Direct materials $38 Direct labor 27 Variable overhead is applied based on direct labor hours. The variable overhead rate is $170 per direct-labor hour. The fixed overhead rate (at the master budget level of activity) is $85 per unit. All non-manufacturing costs are fixed and are budgeted at $2.7 million for the coming year. At the end of the year, the costs analyst reported that the sales activity variance for the year was $900,000 unfavorable. The following is the actual income statement (in thousands of dollars) for the year. Sales revenue $37,538 Less variable costs Direct materials 3,968 Direct labor 3,260 9,980 $17,208 $20,330 Variable overhead Total variable costs Contribution margin Less fixed costs 1,200 1,380 $ 2,580 Fixed manufacturing overhead Non-manufacturing costs Total fixed costs Operating profit $17,750 During the year, the company purchased 206,000 pounds of material and employed 55,400 hours of direct labor. Required: a. Compute the direct material price and efficiency variances. b. Compute the direct labor price and efficiency variances. c. Compute the variable overhead price and efficiency variances.