Requirement $1.$ Compute the price and quantity variances for direct materials. Compute the rate and efficiency variances for direct labor. $($Enter the variances as positive numbers. Enter currency amounts to the nearest cent and your answers to the nearest whole dollar. Label the variance as favorable $($F$)$ or unfavorable $($U$)$ in the input field after the amount you enter. Abbreviations used: DM $=$ Direct materials, DL $=$ Direct labor.$)$

Begin with the variances for direct materials. First, determine the formula for the direct materials price variance, then compute the price variance for direct materials. $($Assume that the quantity of materials purchased is equal to the quantity of materials used.$)$

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DM price variance

$\backslash (\backslash$times$(\backslash )\backslash (-\backslash ))\backslash (=\backslash$mid $\backslash )$ Superior Guard, which used a standard cost accounting system, manufactured $200,000$ boat fenders during the year, using $\backslash (1,700,000\backslash )$ feet of extruded vinyl purchased at $\backslash (\backslash$$ $1\mathrm{.}50\backslash )$ per foot. Production required $4,400$ direct labor hours that cost $\backslash (\backslash$$ $17\mathrm{.}00\backslash )$ per hour. The materials standard was $8$ feet of vinyl per fender at a standard cost of $\backslash (\backslash$$ $1\mathrm{.}55\backslash )$ per foot. The labor standard was $0\mathrm{.}023$ direct labor hour per fender at a standard cost of $\backslash (\backslash$$ $16\mathrm{.}50\backslash )$ per hour.

Read the requirements.

Requirement $1.$ Compute the price and quantity variances for direct materials. Compute the rate and efficiency variances for direct labor. $($Enter the variances as positive numbers. Enter currency amounts to the nearest cent and your answers to the nearest whole dollar. Label the variance as favorable $($F$)$ or unfavorable $($U$)$ in the input field after the amount you enter. Abbreviations used: DM $=$ Direct materials, DL $=$ Direct labor.$)$

Begin with the variances for direct materials. First, determine the formula for the direct materials price variance, then compute the price variance for direct materials. $($Assume that the quantity of materials purchased is equal to the quantity of materials used.$)$ Requirements

$1.$ Compute the price and quantity variances for direct materials. Compute the rate and efficiency variances for direct labor.

$2.$ Does the pattern of variances suggest that the company's managers have been making trade$-$offs? Explain.