The Bruce Swindle Company makes a candy called ZoWee WoWee. The standard for one ZoWee WoWee candy is as follows:

Standard

Manufacturing Cost elements Quantity Price Cost

Direct materials 6 oz. $ .95 $5.70

Direct labor .5 hrs $12.00 6.00

Manufacturing overhead .5 hrs $ 4.80 2.40

Total $14.10

During the month, the following transactions occurred in manufacturing 10,000 candies:

1. 56,000 ounces of materials were purchased at $1.00 per ounce

2. All the materials purchased were used to produce the 10,000 units of candy.

3. 5,000 direct labor hours were worked at a total labor cost of $56,500.

4. Variable manufacturing overhead incurred was $15,000 and fixed overhead incurred was $10,400.

The manufacturing overhead rate of $4.80 is based on a normal capacity of 5,200 direct labor hours.

The total budget at this capacity is $24,960 ($10,400 fixed and $14,560 variable)

Instructions: SHOW WORK

A. Compute the price, quantity and total variances for direct materials and direct labor elements.

B. Compute the total variance (only the total variance) for manufacturing overhead.

Figure your answers below and record your final answer in the space provided.

A.

Materials price variance: _____________________ Favorable or Unfavorable _________

Materials quantity variance: _____________________ Favorable or Unfavorable _________

Total materials variance: _____________________ Favorable or Unfavorable _________

Labor Rate variance: _____________________ Favorable or Unfavorable _________

Labor Efficiency variance: ____________________ Favorable or Unfavorable _________

Total spending variance: ____________________ Favorable or Unfavorable _________

B.

Overhead total spending Variance: ______________ Favorable or Unfavorable __________