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Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 112,000 liters at a budgeted price of $165 per liter this year. The standard direct cost sheet for one liter of the preservative follows.

Direct materials	(2 pounds @ $10)	$	20
Direct labor	(0.5 hours @ $36)		18

Variable overhead is applied based on direct labor hours. The variable overhead rate is $80 per direct-labor hour. The fixed overhead rate (at the master budget level of activity) is $40 per unit. All non-manufacturing costs are fixed and are budgeted at $1.8 million for the coming year.

At the end of the year, the costs analyst reported that the sales activity variance for the year was $522,000 unfavorable.

The following is the actual income statement (in thousands of dollars) for the year.

Sales revenue	$	17,738
Less variable costs
Direct materials		1,948
Direct labor		1,070
Variable overhead		990
Total variable costs	$	4,008
Contribution margin	$	13,730
Less fixed costs
Fixed manufacturing overhead		1,110
Non-manufacturing costs		1,290
Total fixed costs	$	2,400
Operating profit	$	11,330

Required:

Prepare a profit variance analysis. (Enter your answers in thousands of dollars. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.)

* Need help with figuring out the Manufacturing Variances*

PAYNESVILLE CORPORATION Profit Variance Analysis Actual Manufacturing Variances Non-Manufacturing Variances $ Sales revenue Materials Direct labor Variable overhead Total variable costs Contribution margin Fixed costs: Manufacturing Non-manufacturing Total fixed costs Operating profits 17,738 1,948 1,070 990 4.008 13,730 $ $ 1,110 1.290 2,400 11,330 $ 510F $ $

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