1. Skyline manufactures a single product. The standard cost of one unit of this product is as

follows

Direct materials: 5 feet at $1 per foot	$ 5.00
Direct labor: 1 hour at $4.50 per hour	4.50
Variable manufacturing overhead: 1 hour at $3 per hour	3.00
Total standard variable cost per unit	$12.50

During October, 5,500 units were produced. Selected data relating to the months production

follow:

Material purchased: 50,000 feet at $0.95 per foot	$47,500
Material used in production: 28,000 feet
Direct labor: 6,000 hours at $4.30 per hour	$25,800
Variable manufacturing overhead cost incurred	$20,475

There was no beginning inventory of raw materials. The variable manufacturing overhead rate

is based on direct labor-hours.

Required:

1. For direct materials: (2marks)

a. Compute the price and quantity variances for October.

b. Prepare journal entries to record activity for October.

2. For direct labor: (2marks)

a. Compute the rate and efficiency variances for October.

b. Prepare a journal entry to record labor activity for October.

3. For variable manufacturing overhead: (1mark)

a. Compute the spending and efficiency variance for October.