Answer:
1. Direct material price variance = $26,208 favorable
Direct material efficiency variance = $2,025 adverse
2. Labor rate variance = $3,150 adverse
Labor efficiency variance = $3,000 Favorable
Explanation:
1. Direct materials variances:
Actual unit cost = $68,750 ÷ 3,150 square yards
= $21.82 per square yard
Standard quantity 2 × 1,500
= 3,000 square yards
Direct material price variance = (Actual quantity purchased × Actual price) - (Actual quantity purchased × Standard price)
= (3,150 × $21.82) - (3,150 × $13.50)
= $68,733 - $42,525
= $26,208 favorable
Direct material efficiency variance = (Actual quantity used × Standard price) - (Standard quantity allowed × Standard price)
= (3,150 × $13.50) - (3,000 × $13.50)
= $2,025 adverse
2. Actual Rate = $45,150 ÷ 2,100
= $21.5 per hour
Standard hour = 1.5 × 1,500
= 2,250 hours
Labor rate variance = (Actual hour worked × Actual rate) - (Actual hours worked × standard rate)
(2,100 × $21.5) - (2,100 × $20)
= $3,150 adverse
Labor efficiency variance = (Actual hour worked × Standard rate) - (Standard hours allowed × Standard rate)
= (2,100 × $20) -(2,250 × $20)
= $3,000 Favorable
