Requirement $1.$ Compute the January $2020$ price and efficiency variances of direct materials and direct manufacturing labor.

$$Let$\text{'}$s begin by calculating the actual input at the budgeted price. $($Round your answers to the nearest whole$$ dollar.$)$

Actual input

$\backslash$times

Budgeted price

$=$

Cost

Direct materials $($purchases$)$

$100,100$

$\backslash$times

$$5\mathrm{.}00$

$=$

$$500,500$

Direct materials $($usage$)$

$98,000$

$\backslash$times

$$5\mathrm{.}00$

$=$

$$490,000$

Direct manufacturing labor

$4,700$

$\backslash$times

$$31\mathrm{.}00$

$=$

$$145,700$

Part $2$

Next determine the formula and calculate the costs for the flexible budget.

Budgeted input for actual output

$\backslash$times

Budgeted price

$=$

Flexible budget cost

Direct materials

$99,000$

$\backslash$times

$$5\mathrm{.}00$

$=$

$$495,000$

Direct manufacturing labor

$4,950$

$\backslash$times

$$31\mathrm{.}00$

$=$

$$153,450$

Part $3$

Now compute the price and efficiency variances for direct materials and direct manufacturing labor. Label each variance as favorable$($F$)$ or unfavorable$($U$).$

Price

Efficiency

variances

variances

Direct materials

Direct manufacturing labor