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Question 4(10 marks) Chaten Company manufactures bags of fertilizer that have the following unit...

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Accounting

Question 4(10 marks)
Chaten Company manufactures bags of fertilizer that have the following unit standard costs for direct
materials and direct labor:
The following activities were recorded for October:
1,000 bags were manufactured.
95,000lbs. of materials costing $76,000 were purchased.
,102,500lbs. of materials were used.
$12,000 was paid for 475 hours of direct labor.
There were no beginning or ending work-in-process inventories.
Required:
A. Compute the direct materials variances and indicate each of them is favorable (F) or unfavorable
(U).
B. Compute the direct labor variances and indicate each of them is favorable (F) or unfavorable (U).
C. Give possible reasons for the occurrence of the materials usage variance for this company.
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