Sheridan Labs, Inc. provides mad cow disease testing for both state and federal governmental agricultural agencies. Because the company's customers are governmental agencies, prices are strictly regulated. Therefore, Sheridan Labs must constantly monitor and control its testing costs. Shown below are the standard costs for a typical test. $2.80 Direct materials (2 test tubes @ $1.40 per tube) Direct labor (1 hour @ $30 per hour) Variable overhead (1 hour @ $6.00 per hour) Fixed overhead (1 hour @ $13.00 per hour) Total standard cost per test 30.00 6.00 13.00 $51.80 The lab does not maintain an inventory of test tubes. As a result, the tubes purchased each month are used that month. Actual activity for the month of November 2020, when 1,200 tests were conducted, resulted in the following. Direct materials (2,520 test tubes) Direct labor (1,236 hours) Variable overhead Fixed overhead $3,276 35,844 7,068 14,592 Monthly budgeted fixed overhead is $19,110. Revenues for the month were $79,200, and selling and administrative expenses were $4,300. (a) Your answer is correct. Compute the price and quantity variances for direct materials and direct labor. Materials price variance Favorable Materials quantity variance Unfavorable Labor price variance 1236 Favorable Labor quantity variance 1080) Unfavorable Your answer is correct. Compute the total overhead variance. Total Overhead variance Total Overhead variance 1140 1140 Favorable Favorable Sales Revenue 79200 Cost of Service Provided 62160 Gross Profit (at Standard) 17040 Variances A TMaterials Price Variance 252 Favorable Materials Quantity Variance Unfavorable A J ] Labor Price Variance 1236 Favorable 2 527 Favorable 16811 Unfavorable 1230) Favorable 100 unfavorable 11401 Favorable Favorable Labor Quantity Variance 080 Unfavorable Overhead Variance Total Variance Favorable A 1560 Gross Profit (Actual) 18600 Selling and Administrative Expenses 4300 Net Income / (Loss) 16616