Requirement

Compute the cost and efficiency variances for direct materials and direct labor. Does the pattern of variances suggest Superior Fender's managers have been making trade$-$offs? Explain.

Superior Fender, which uses a standard cost system, manufactured $20,000$ boat fenders during $2024,$ using $141,000$ square feet of extruded vinyl purchased at $$1\mathrm{.}45$ per square foot. Production required $450$ direct labor hours that cost $$13\mathrm{.}50$ per hour. The direct materials standard was seven square feet of vinyl per fender, at a standard cost of $$1\mathrm{.}50$ per square foot. The labor standard was $0\mathrm{.}026$ direct labor hour per fender, at a standard cost of $$12\mathrm{.}50$ per hour.

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Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is favorable $(F)$ or unfavorable $($U$).($Abbreviations used: $AC=$ actual cost; $AQ=$ actual quantity; FOH$=$ fixed overhead; SC $=$ standard cost; SQ $=$ standard quantity.$)$

$\backslash$table$[[,$Formula,Variance,$],[$Direct materials cost,,,$],[$variance$,,=,],[$Direct labor cost variance,$=,=,]]$