Problem - The following actual data was given for the firm.
8,000 pounds of material were purchased costing $ 40,000
Four hundred units were produced requiring 900 labor hours costing $4,500 and 1, 000 pounds of material. The standard for labor is 2 hours per unit with a wage rate of $3 per hour and for materials 2 pounds per unit at a price of $4 per unit.
A) Calculate all labor variances.
B) Calculate all material variances.
C) Write an analysis of how you would explain to management the meaning of the variance you calculated.