ABC Company has developed the following standard costs for its product
Product 1 cost element:Standard Quantity x Standard Price = Unit Standard Cost
Direct Materials 3 pounds x $2 = $6
Direct Labor 2 hours x $8 = $16
Manufacturing Overhead2 hours x $4 = $8
Total = $30
ABC Company expected to produce 20,000 units of Product 1 this year and work 40,000 direct labor hours. Actual results for the year are: 19,000 units of Product 1 produced. Actual direct labor costs were $306,000 for 36,000 direct labor hours worked. Actual direct materials purchased and used during the year cost $112,100 for 59,000 pounds. Actual variable overhead incurred was $159,000.
A) Compute materials price and usage variances.
B) Compute the labor price and usage variance.
C) Compute the variable overhead spending and efficiency variances.