Reference no: EM132639815

The information in the table below pertains to Sweet Treats Ltd for the month of June. Overhead is allocated on the basis of direct labour hours.

Standard quantity of materials 5 kg per batch

Standard cost per kg $12

Standard direct labour hours 1.5 per batch

Standard wage rate per hour $25

Direct materials purchased 10,000 kg

Cost of direct materials purchased per kg $10

Direct materials consumed to produce 2,000 batches of goods (Actual Production) 8,000 kg

Actual direct labour hours to produce 2,000 batches of goods 2,950

Actual direct labour cost per hour $25.50

Planned Production for June 2,000 batches

Estimated variable Manufacturing Overhead $42,000

Estimated fixed Manufacturing Overhead $120,000

Actual variable Manufacturing Overhead $45,000

Actual fixed Manufacturing Overhead $123,000

Problem 1: Calculate the price and efficiency variances for materials and labour and the total direct labour variance for June. Use F or U to indicate whether the variances are favourable or unfavourable.