Diamond Company makes one product and has set the following standards for materials and labor:
Direct Materials Direct Labor
Standard quantity or hours per unit ? pounds 2.10 hours
Standard price or rate ? per pound $ 8.50 per hour
Standard cost per unit ? $ 17.85
During the past month, the company purchased 6,200 pounds of direct materials at a cost of $17,050. All of this material was used in the production of 1,300 units of product. Direct labor cost totaled $20,070 for the month. The following variances have been computed:
Materials quantity variance $ 1,200 U
Total materials spending variance $ 350 F
Labor efficiency variance $ 4,250 F
Required:
1. For direct materials:
a.
Compute the standard price per pound for materials. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
b.
Compute the standard quantity allowed for materials for the month’s production.
c.
Compute the standard quantity of materials allowed per unit of product. (Round your answer to 2 decimal places.)
2. For direct labor:
a. Compute the actual direct labor cost per hour for the month.
b.
Compute the labor rate variance. (Input the amount as positive value. Do not round intermediate calculations. Indicate the effect of the variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)