Supreme Canine Products produces high quality dog food distributed only through veterinary offices. To ensure that the food is of the highest quality and has taste appeal, Supreme has a rigorous inspection process. For quality control purposes, Supreme has a standard based on the pounds of food inspected per hour and the number of pounds that pass or fail the inspection. Supreme expects that for every 15,000 pounds of food produced, 1,500 pounds of food will be inspected. Inspection of 1,500 pounds of dog food should take 1 hour. Supreme also expects that 6% of the food inspected will fail the inspection. During the month of May, Supreme produced 3,000,000 pounds of food and inspected 277,500 pounds of food in 215 hours. Of the 277,500 pounds of food inspected, 15,650 pounds of food failed to pass the inspection.

Required

1. Compute two variances that help determine whether the time spent on inspections was more or less than expected. (Follow a format similar to the one used for the variable overhead spending and efficiency variances, but without prices.)

2. Compute two variances that can be used to evaluate the percentage of the food that fails the inspection.