The following direct materials and direct labor data pertain to the operations of Laurel Company for the month of August.

Costs
Actual labor rate		$13	per hour
Actual materials price		$128	per ton
Standard labor rate		$12.50	per hour
Standard materials price		$130	per ton

Quantities
Actual hours incurred and used		4,150 hours
Actual quantity of materials purchased and used		1,220 tons
Standard hours used		4,300 hours
Standard quantity of materials used		1,200 tons

(a) Compute the total, price and quantity variance for materials and labor.

(b) Provide two possible explanation for each of the unfavorable variances calculated above, and suggest where responsibility for the unfavorable result might be placed.

(a) Total materials variance:
( AQ x AP )	-	( SQ x SP )	=
	-		=

Materials price variance:
( AQ x AP )	-	( AQ x SP )	=
	-		=

Materials quantity variance:
( AQ x SP )	-	( SQ x SP )	=
	-		=

Total labor variance:
( AH x AR )	-	( SH x SR )	=
	-		=

Labor price variance:
( AH x AR )	-	( AH x SR )	=
	-		=

Labor quantity variance:
( AH x SR )	-	( SH x SR )	=
	-		=

(b)