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Materials and Labor Variances Analyser Zippy Inc. manufacturos a fuel additive, Surge, which has a stable seling price of $44 per drum. The company has bean producing and selling 80,000 drums per month. In connection with your examination of Zippy's financial statements for the year ended September 30, management has asked you to review some computations made by 2ippy's cost accountant. Your working papers disclose the following about the company's operations: Standard costs per drum of product manufactured: Materiala: $16 1 empty drum 1 $17 Direct labor-1 hour $10 Factory Overhead. Costs and expenses during September Chemicals: 645,000 gallons purchased at a cost of 1,140,000; 600,000 gallons used. Empty drums: 94,000 purchased at a cost of $94,000; 80,000 drums used Direct labor: 81,000 hours worked at a cost of $816,480. Factory overhesd: $768,000 Required Calculate the following for September Compute the materials wariances for both Surge and for the drums. If an amount is zero, enter "Oand use NA" fthe venance is zero. Use "F' and "U' to indicate favorable and unfavorable variances. Enter all amounts as positive numbers, Round unit costs to the nearest whole cent. 1. Materials quantity variance for Surge Materials quantity variance for Drums. Materiels purchase price variance for Surge. Materiels purchase price variance for Drums 2. 132000 3. Labor emiciancy variance 8000 4. Labor rate variance

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