QUESTION 1

Alvarado Company produces a product that requires 10 standard pounds per unit. The standard price is $9.00 per pound. If 6,200 units used 60,100 pounds, which were purchased at $9.18 per pound, what is the direct materials (a) price variance, (b) quantity variance, and (c) cost variance? Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Line Item Description	Amount	Variance
a. Direct materials price variance		FavorableUnfavorable
b. Direct materials quantity variance		FavorableUnfavorable
c. Direct materials cost variance		FavorableUnfavorable

QUESTION 2

Alvarado Company produces a product that requires 10 standard direct labor hours per unit at a standard hourly rate of $13.00 per hour. If 2,600 units used 27,000 hours at an hourly rate of $12.61 per hour, what is the direct labor (a) rate variance, (b) time variance, and (c) cost variance? Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Line Item Description	Amount	Variance
a. Direct labor rate variance		FavorableUnfavorable
b. Direct labor time variance		FavorableUnfavorable
c. Direct labor cost variance		FavorableUnfavorable