Problem 16-64 Comprehensive Variance Problem (LO 16 - 5, 6)

The standard cost sheet for Chambers Company, which manufactures one product, follows:

Direct materials, 40 yards at $3.00 per yard	$	120
Direct labor, 5 hours at $30 per hour		150
Factory overhead applied at 70% of direct labor		105
(variable costs = $70; fixed costs = $35)
Variable selling and administrative		74
Fixed selling and administrative		50
Total unit costs	$	499

Standards have been computed based on a master budget activity level of 29,800 direct labor-hours per month. Actual activity for the past month was as follows:

Materials used		238,000	yards at $3.15 per yard
Direct labor		28,100	hours at $31.00 per hour
Total factory overhead	$	650,000
Production		5,500	units

Required:

Prepare variance analyses for the variable and fixed costs. Materials are purchased as they are used. (Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.)

Direct materials:
Price variance
Efficiency variance
Direct labor:
Price variance
Efficiency variance
Variable overhead:
Efficiency variance
Fixed overhead:
Production volume variance