The Pool Company manufactures products for the maintenance of swimming pools. The following financial information...
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Accounting
The Pool Company manufactures products for the maintenance of swimming pools. The following financial information relates to the October production of bulk bags of Chlorine, one of their best selling products. The company recognises the materials price variance when materials are purchased.
Standard quantity of materials
10 kgs.
Standard cost of materials
$1.00
Standard direct labour hours
0.5
Standard wage rate per hour
$22.00
Standard variable overhead rate per direct labour hour
$7.00
Direct materials purchased
55,000 kgs.
Cost of direct materials purchased per kilograms
$0.95
Direct materials consumed for manufacture of 5,000 units
47,000 kgs.
Actual direct labour hours required for 5,000 units
2,400
Actual direct labour cost per hour
$23.00
Total actual variable overhead costs for the month
$19,000
Required: Calculate the price and efficiency (quantity) variances for direct materials and direct labour and variable overhead spending and efficiency variances. (Round answers to 0 decimal places, enter all answers as positive numbers and choose whether it is favourable (enter F) or unfavourable (enter U))
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