Use the following data to analyze direct labor variances:

Direct labor hours worked (AQ)		35,400
Standard direct labor hours for units manufactured (SQ)		37,700
Unfavorable direct labor rate variance	$	17,700
Total payroll for direct labor	$	407,100

1. What was the total flexible-budget variance of direct labor? (Rounded to the nearest dollar.)

$ (Click to select) favorable unfavorable

2. Prepare appropriate journal entries for the direct labor rate and efficiency variance.

3. Following the interpretations in the lecture videos, how will you analyze and explain the above variance to the company? Briefly show your work and reasoning.