Reference no: EM13572656

Rondello Corporation manufactures a single product. The standard cost per unit of product is shown below.

Direct materials-2 pound plastic at $7 per pound		$ 14.00
Direct labor-1.00 hours at $11.00 per hour		11.00
Variable manufacturing overhead		6.50
Fixed manufacturing overhead		7.50
Total standard cost per unit		$39.00

The predetermined manufacturing overhead rate is $14 per direct labor hour ($14 ÷ 1.00). It was computed from a master manufacturing overhead budget based on normal production of 5,800 direct labor hours (5,800 units) for the month. The master budget showed total variable costs of $37,700 ($6.50 per hour) and total fixed overhead costs of $43,500 ($7.50 per hour). Actual costs for October in producing 3,100 units were as follows.

Direct materials (6,310 pounds)		$ 45,937
Direct labor (2,990 hours)		33,877
Variable overhead		32,203
Fixed overhead		13,217
Total manufacturing costs		$125,234

The purchasing department buys the quantities of raw materials that are expected to be used in production each month. Raw materials inventories, therefore, can be ignored.
(a) Compute all of the materials and labor variances.

Total materials variance		$		UnfavorableFavorableNeither favorable nor unfavorable
Materials price variance		$		Neither favorable nor unfavorableUnfavorableFavorable
Materials quantity variance		$		UnfavorableFavorableNeither favorable nor unfavorable
Total labor variance		$		UnfavorableNeither favorable nor unfavorableFavorable
Labor price variance		$		UnfavorableNeither favorable nor unfavorableFavorable
Labor quantity variance		$		FavorableUnfavorableNeither favorable nor unfavorable

(b) Compute the total overhead variance.

Total overhead variance

$

UnfavorableFavorableNeither favorable nor unfavorable