Information;

1. The standard variable cost per unit is as follow:

Direct material: 4 metres at R 7 per metre

Direct labour: 3 1/2 hours at R8 per hour

Variable manufacturing overheads: 3 1/2 hours at R 2 per hour

2. The budget selling price per unit is R 120

3. The actual results for December 2018 in which 20 000 products were manufactured and are sold:

- Sales amounted to R 2 480 000

-Total cost of material purchased was R 585 000 at R 7.50 per meter. There was no opening or closing stock of material.

-Total labor cost was R 507 000 at a rate of R 7.80 per hour

-Variable manufacturing overheads amounted to R 136 500

Jumbo Limited manufactures a single product and uses a standard costing system

Required:

Use the information provided to calculate to calculate the following variances for December 2018. Where applicable, round off all amounts to the nearest RAND. Also indicate in each case whether the variance is favorable or unfavorable.

1. Material purchased price variance (3)

2.Labor efficiency variance (3)

3. Variable manufacturing overhead efficiency variance (3)

4. Sales price variance (3)