Describe the direct materials price and quantity variances

Question

Sonne Company produces a perfume called Whim. The direct materials and direct labor standards for one bottle of Whim are given below:

	Standard Quantity or Hours		Standard Price or Rate			Standard Cost
Direct materials	7.40	ounces	$	2.60	per ounce	$	19.24
Direct labor	0.45	hours	$	8.00	per hour	$	3.60

During the most recent month, the following activity was recorded:

a.	12,100 ounces of material were purchased at a cost of $2.50 per ounce.
b.	All of the material was used to produce 1,500 bottles of Whim.
c.	575 hours of direct labor time were recorded at a total labor cost of $5,750.

Required:

1.	Compute the direct materials price and quantity variances for the month.