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    Calculation of Variance

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    During June, Danby Company's material purchases amounted to 6,000 pounds at a price of $7.30 per pound. Actual costs incurred in the production of 2,000 units were as follows:
    Direct labor: $116,745 ($18.10 per hour)
    Direct material: $30,660 ($7.30 per pound)

    The standards for one unit of danby Company's product are as follows:
    Direct labor: Direct Material:
    Quantity, 3 hours per unit Quantity, 2 pounds per unit
    Rate,$18 per hour Price, $7 per pound

    Required: Compute the direct-material price and quantity variance and the direct-labor rate and efficiency variances. Indicate whether each variance is favorable or unfavorable.

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