Refer to the Johnson data in Short Exercises S23- 6, S23- 7, and S23- 9.

Exercises S23- 6

Johnson, Inc. is a manufacturer of lead crystal glasses. The standard direct ­materials quantity is 0.8 pound per glass at a cost of $ 0.30 per pound. The actual result for one month’s production of 6,900 glasses was 1.1 pounds per glass, at a cost of $ 0.40 per pound. Calculate the direct materials cost variance and the direct ­materials efficiency variance.

Exercises S23- 7

Johnson, Inc. manufactures lead crystal glasses. The standard direct labor time is 0.3 hours per glass, at a cost of $ 13 per hour. The actual results for one month’s production of 6,900 glasses were 0.2 hours per glass, at a cost of $ 10 per hour. Calculate the direct labor cost variance and the direct labor efficiency variance.

Exercises S23- 9

Static budget variable overhead .......$ 9,000

Static budget fixed overhead .........$ 4,500

Static budget direct labor hours ........1,800 hours

Static budget number of glasses .........6,000 glasses

Requirements

1. Compute the overhead variances for the month: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance.

2. Explain why the variances are favorable or unfavorable.