Reference no: EM132317157

Question

Apple Valley Orchards, Inc. (AVO), developed standard costs for direct material and direct labor. In 2019, AVO estimated the following standard costs for one of their most well-loved products, the AVO classic Grandma's large apple pie which had a brown sugar coating on the top of the crust as well as including cranberry and mince ingredients in addition to the apples.

Budgeted quantity Budgeted price

Direct materials 1.45 pounds $7.15 per pound

Direct labor 0.25 hours $14.00 per hour

During September, AVO produced and sold 1,200 pies using 1,875 pounds of direct materials at an average cost per pound of $7.00 and 280 direct labor hours at an average wage of $14.25 per hour. Also, state if the variance is favorable or unfavorable for each answer below.

a) September's direct material flexible-budget variance is:

b) September's direct material price variance is:

c) September's direct material efficiency variance is: