Manik Plc Ltd. makes a product with the following standard costs:
| Inputs: |
Unit of Input |
Units per item |
Price or rate |
| Direct Materials: |
pints |
32 |
$28/pint |
| Direct Labor: |
direct labor hours |
28 |
$10/direct labor hour |
| Variable Overhead: |
direct labor hours |
$8/direct labor hour |
The company reported the following results concerning this product in December.
| Actual output: |
178 items |
| Raw Materials used: |
5,655 pints |
| Raw Material purchased: |
6,169 pints |
| Actual direct labor hours: |
4,450 hours |
| Actual cost of raw materials purchased: |
$160,394 |
| Actual direct labor cost: |
$53,400 |
| Actual variable overhead cost: |
$40,050 |
Oliver applies variable overhead on the basis of direct labor hours. The direct material purchases variance is computed when the materials are purchased. What are the following variances? Be sure to note if they are favorable or unfavorable.
Part 1: Direct Material quantity variance:
Part 2: Direct Material price variance:
Part 3: Direct Labor efficiency variance:
Part 4: Direct Labor rate variance: