Sports Universe, Inc. manufactures premium golf bags and has developed the following per-unit standard costs for 2020 for each golf bags:

Manufacturing

Direct Materials Direct Labour Overhead

Standard Quantity 2 Kilograms 1/2 hour 1/2 hour

Standard Price $8.00 $20.00 $12.00

Unit Standard Cost $16.00 $10.00 $6.00

In 2020, the company planned to produce 80,000 golf bags at a level of 40,000 hours of direct labour.

Actual results for 2020 are presented below:

1. Direct materials purchased were 164,000 kilograms which cost $688,800.

2. Direct materials used were 146,000 kilograms.

3. Direct labour costs were $374,400 for 39,000 direct labour hours actually worked.

4. Total manufacturing overhead was $468,000.

5. Actual production was 76,000 golf bags.

Instructions

a) Calculate the following variances. Denote whether they are F (favourable) or U (unfavourable). (10 marks):

Direct materials price variance = _________________

Direct materials quantity variance = _________________

Direct labour price variance = _________________

Direct labour quantity variance = _________________

Total overhead variance = _________________

.

b) Using a standard cost accounting system, prepare all journal entries to record the transactions and events above (9 marks).