Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis

Santiago Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of $74,000$ units of product were as follows:

Line Item DescriptionStandard CostsActual CostsDirect materials$236,800$ lbs$.$ at $$5\mathrm{.}20$ per lb$\mathrm{.}234,400$ lbs$.$ at $$5\mathrm{.}00$ per lb$.$Direct labor$18,500$ hrs$.$ at $$18\mathrm{.}00$ per hr$\mathrm{.}18,930$ hrs$.$ at $$18\mathrm{.}40$ per hr$.$Factory overheadRates per direct labor hr$.,$ based on $100\%$ of normal capacity of $19,310$ direct labor hrs$.$:$$Factory overhead$$Variable cost$,$ $$3\mathrm{.}60$$$65,930$ variable costFactory overhead$$Fixed cost$,$ $$5\mathrm{.}70$$$110,067$ fixed cost

Each unit requires $0\mathrm{.}25$ hour of direct labor.

Required:

a$.$Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Line Item DescriptionAmountVarianceDirect Materials Price Variance$fill in the blank $1$

FavorableUnfavorableFavorable

Direct Materials Quantity Variance$fill in the blank $3$

FavorableUnfavorableFavorable

Total Direct Materials Cost Variance$fill in the blank $5$

FavorableUnfavorableFavorable

b$.$Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Line Item DescriptionAmountVarianceDirect Labor Rate Variance$fill in the blank $7$

FavorableUnfavorableUnfavorable

Direct Labor Time Variance$fill in the blank $9$

FavorableUnfavorableUnfavorable

Total Direct Labor Cost Variance$fill in the blank $11$

FavorableUnfavorableUnfavorable

c$.$Determine the variable factory overhead controllable variance, fixed factory overhead volume variance, and total factory overhead cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Line Item DescriptionAmountVarianceVariable factory overhead controllable variance$fill in the blank $13$

FavorableUnfavorableFavorable

Fixed factory overhead volume variance$fill in the blank $15$

FavorableUnfavorableUnfavorable

Total factory overhead cost variance$fill in the blank $17$

FavorableUnfavorableUnfavorable