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Jonas Materials Science (JMS) purchases its materials from several countries. As part of its cost-control program, JMS uses a standard cost system for all aspects of its operations, including purchases of direct materials. The company establishes standard costs for direct materials at the beginning of each fiscal year.

Pat Butch, the purchasing manager, is happy with the result of the year just ended. He believes that the purchase price variance for direct materials for the year will be favorable and is very confident that his department has at least met the standard prices. The preliminary report from the controllers office confirms his jubilation. Following is a portion of the preliminary report:

Total quantity purchased	40,000	kilograms
Average price per kilogram	$ 50.00
Standard price per kilogram	$ 60.00
Budgeted quantity per quarter	5,000	kilograms

In the fourth quarter, the purchasing department increased purchases from the budgeted normal volume of 5,000 to 25,000 kilograms to meet the increased demands, which was a result of the firms unexpected success in a fiercely competitive bidding. The substantial increase in the volume to be purchased forced the purchasing department to search for alternative suppliers. After frantic searches, it found suppliers in several foreign countries that could meet the firms needs and could provide materials with higher quality than that of JMSs regular supplier. The purchasing department was very reluctant to make the purchase because the negotiated price was $77.00 per kilogram, including shipping and import duty. However, this original reluctance disappeared upon learning that the actual cost of the purchases would be much lower than expected due to currency devaluations (the result of financial turmoil in several of the countries in the region).

Patricia Rice, the controller, does not share the purchasing departments euphoria. She is fully aware of the following quarterly purchases of direct materials:

	First Quarter	Second Quarter	Third Quarter	Fourth Quarter
Quantity	5,000	5,000	5,000	25,000
Purchase price (per kilogram)	$68.00	$69.00	$74.00	?

Required:

1. Calculate the direct materials purchase price variance for the fourth quarter and for the year. How much of each purchase price variance is attributable to changes in foreign currency exchange rates? (Do not round intermediate calculations.)

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