Standard Cost Systems Variance Computations
Livingston Corporation Recently Implemented a Standard

Standard cost systems variance computations
Livingston Corporation recently implemented a standard cost system. The company's cost accountant has provided the following data to perform a variance analysis for May:
Compute the following variances. Indicate whether each variance is favorable (F) or unfavorable (U):
(a) Materials price variance: $___________
(b) Materials quantity variance: $___________
(c) Labor rate variance: $___________
(d) Labor efficiency variance: $___________
(e) Overhead spending variance: $___________
(f) Overhead volume variance: $___________
$\begin{array}{|l|l|}\hline \text { Standard Cost Information } & \\\hline \text { Direct Material Standard Price } & \$ 12 \text { per pound } \\\hline \text { Standard Quantity Allowed Per Unit } & 4 \text { pounds per unit } \\\hline \text { Direct Labor Standard Rate } & \$ 7 \text { per hour } \\\hline \text { Standard Hours Allowed Per Unit } & 0.5 \text { hours per unit } \\\hline \text { Fixed Overhead Budgeted } & \$ 24,000 \text { per month } \\\hline \text { Normal Level of Production } & 12,000 \text { units per month } \\\hline \text { Variable Overhead Application Rate } & \$ 1.80 \text { per unit } \\\hline \text { Fixed Overhead Application Rate } & \\\hline(\$ 24,000 / 12,000 \text { units }) & \$ 2.00 \text { per unit } \\\hline \text { Total Overhead Application Rate } & \$ 3.80 \text { per unit } \\\hline\\\hline \text { Actual Cost Information } & \\\hline \text { Cost of Material Purchased \& Used } & \$ 429,000 \\\hline \text { Pounds of Material Purchased \& Used } & 39,000 \text { pounds } \\\hline \text { Cost of Direct Labor } & \$ 23,100 \\\hline \text { Hours of Direct Labor } & 4,200 \text { hours } \\\hline \text { Cost of Variable Overhead } & \$ 17,750 \\\hline \text { Cost of Fixed Overhead } & \$ 24,200 \\\hline \text { Actual Volume of Production } & 10,400 \text { units } \\\hline\end{array}$