1. Price and Efficiency Variances

The Wayne Corporation manufactures lamps. It has set up the following standards per finished unit for direct materials and direct manufacturing labor:

Direct materials: 10 lbs. at $5.00 per lb.	$50.00
Direct manufacturing labor: 0.5 hour at $29 per hour	14.50

The number of finished units budgeted for January 2021 was 9,580; 9,550 units were actually produced.

Actual results in January 2021 were:

Direct materials: 93,500 lbs. used
Direct manufacturing labor: 4,500 hours	$136,125

Assume that there was no beginning inventory of either direct materials or finished units.

During the month, materials purchases amounted to 95,800 lb., at a total cost of $498,160. Input price variances are isolated upon purchase. Input-efficiency variances are isolated at the time of usage.

Requirements

1).	Compute the January 2021 price and efficiency variances of direct materials and direct manufacturing labor. Comment on the variances and what they imply about the Wayne Corp.