Puvo, Inc., manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard cost system and has established the following standards for one unit of product:

	Standard Quantity			Standard Price or Rate			Standard Cost
Direct materials		2.5	pounds	$	5.00	per pound	$	12.50
Direct labor		0.6	hours	$	14.00	per hour	$	8.40
Variable manufacturing overhead		0.6	hours	$	3.25	per hour	$	1.95

During March, the following activity was recorded by the company:

The company produced 4,600 units during the month.

A total of 15,000 pounds of material were purchased at a cost of $42,000.

There was no beginning inventory of materials on hand to start the month; at the end of the month, 3,000 pounds of material remained in the warehouse.

During March, 2,960 direct labor-hours were worked at a rate of $14.50 per hour.

Variable manufacturing overhead costs during March totaled $5,972.

The direct materials purchases variance is computed when the materials are purchased.

The materials quantity variance for March is:_____

Multiple Choice

$2,500 U

$2,500 F

$23,500 U

$23,500 F