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Fall Industries has set the following standards for one unit: Direct material Quantity: 45 yards...

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Accounting

Fall Industries has set the following standards for one unit:

Direct material

Quantity: 45 yards

Price per yard: $2.70 per yard

Direct labor

Quantity: 9 hours per unit

Rate per hour: $16 per hour

Actual costs incurred in the production of 1,200 units were as follows:

Direct material: $99,000 ($2.75 per yard)

Direct labor: $129,560 ($15.80 per hour)

All materials purchased were consumed during the period. Required:

1. Calculate the direct-material price and quantity variances. Indicate whether each variance is favorable or unfavorable.

2. Calculate the direct-labor rate and efficiency variances. Indicate whether each variance is favorable or unfavorable.

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