Waterways Corporation uses very stringent standard costs in evaluating its manufacturing efficiency. These standards are not ideal at this point, but the management is working toward that as a goal. At present, the company uses the following standards. Materials Item Per unit Cost Metal 1 lb. 63 per lb. Plastic 12 oz. $1.00 per lb. Rubber 4 oz. 88 per lb. Direct Labor Item Per unit Cost Labor 15 min. $8.00 per hr. Predetermined overhead rate based on direct labor hours = $4.28 The January figures for purchasing, production, and labor are: The company purchased 229,000 pounds of raw materials in January at a cost of 78 a pound. Production used 229,000 pounds of raw materials to make 115,500 units in January. Direct labor spent 18 minutes on each product at a cost of $7.80 per hour. Overhead costs for January totaled $54,673 variable and $73,800 fixed. Instructions

Part A - to evaluate and comment on the labor quantity variances, materials quantity variance, and total overhead variance for this company for January. Your discussion needs to include what the variances suggest to management?