The company expected to produce 30,000 units of Product A in 2021 and work 90,000 direct labour hours.

Actual results for 2021 are as follows:

• 31,000 units of Product A were produced.
• Actual direct labour costs were 746,200 for 91,000 direct labour hours worked.
• Actual direct materials purchased and used during the year cost 346,500 for 126,000 pounds.
• Actual variable overhead incurred was 155,000 and actual fixed overhead incurred was 205,000.

Required: Compute the following variances showing all computations to support your answers. Indicate whether the variances are favourable or unfavourable.

(a) Materials quantity variance.

(b) Total direct labour variance.

(c) Direct labour quantity variance.

(d) Direct materials price variance.

(e) Total overhead variance.

11-11 X Product A Cost Element Standard Quantity Direct materials 4 Direct labor 3 Manufacturing overhead 3 Standard Price 3 3 8 8 4 Standard Cost 12 24 12 48 3