Provide explanation.

Clarissa McWhirter, vicepresident of Cyprus Company, was pleased to see a small variance on the income statement after the trouble the company had been having in controlling manufacturing costs. She noted that the $28,360 overall manufacturing variance reported last period was well below the 3% limit that had been set for variances. The company produces and sells a single product. The standard cost card for the product follows: Standard Cost CardPer Unit Direct materials, 4 metres at $3.70 per metre 514'80 Direct labour, 1.5 direct labour-hours at $8.0 per direct labour-hour 12'00 Variable overhead, 1.5 direct labourhours at $2.7 per direct labourhour 4'05 Fixed overhead, 1.5 direct labourhours at $5 per direct labourhour 7'50 Standard cost per unit $38'35 The following additional information is available for the yearjust completed: a. The company manufactured 32,000 units of product during the year. b. A total of127,000 metres of material was purchased during the year at a cost of $3.75 per metre. All of this material was used to manufacture the 32,000 units. There were no beginning or ending inventories for the year. c. The company worked 50,200 direct labourhours during the year at a cost of $7.90 per hour. d. Overhead cost is applied to products on the basis of standard direct labour-hours. Data relating to manufacturing overhead costs follow: Denominator activity level (direct labourhours) 49,400 Budgeted fixed overhead costs (from the flexible budget) $ 247,000 Actual fixed overhead costs $ 245,900 Actual variable overhead costs $ 136,830 2. Compute the direct labour rate and efficiency variances for the year. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) Labour rate variance $ 5,020 F Labour efficiency variance F None U