Question - Hyde Company has set the following standards for one unit of product:
Direct material: $36 per unit
Quantity: 4 kg per unit
Price: $9 per kg
Direct labour: $63 per unit
Quantity: 3 hours per unit
Rate: $21 per hour
Actual costs incurred in the production of 2,000 units were as follows:
Direct material: $72,540 ($9.30 per kg)
Direct labour: $115,206 ($21.10 per hour)
Required - Calculate the direct material price and quantity variances and the direct labour rate and efficiency variances. Indicate whether each variance is favourable or unfavourable.