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Chapter 11 Watson Chemical Company produces a chemical used in dry cleaning. Its accounting system uses standard costs. The standards call for 0.70 gallons of material and 0.3 hours of labor per half gallon can of chemical. (i.e., 0.70 gallons of material are needed to produce a 0.5 gallon can of product due to evaporation.) The standard cost per gallon of material is $5.35. The standard cost per hour for labor is $21.50. Overhead is applied at the rate of $8.95 per can Expected production is 18,000 cans with fixed manufacturing overhead costs per year of $35,100, and variable overhead of $6.00 per unit (a half gallon can) During 2017, 18,000 cans were produced; 15,000 gallons of material were purchased at a cost of $87,750; 13,000 gallons of material were used in production. The cost of direct labor incurred in 2017 was $122,000 based on an average actual wage rate of $21.75 per hour Actual overhead for 2017 was $170,000. Calculate the labor variances Based on Materials Purchased Based on Materials Used Materials Actual Flx Bdgt Amounts ice Total Price Variance Quantity Variance Labor Amounts Price Total Actual Flx Bdgt Rate Variance Efficiency Variance