Don Johnson is the management accountant for Cari-Blocks (CB), which manufactures specialty blocks. CB uses two direct cost categories: direct materials and direct manufacturing labour. Johnson feels that manufacturing overhead is most closely related to material usage. Therefore, CB allocates manufacturing overhead to production based upon pounds of materials used. At the beginning of 2021, CB budgeted annual production of 200,000 blocks and adopted the following standards for each block:   Direct materials 0.5 lb. @ $12/lb. $ 6.00 Direct manufacturing labour 1.4 hours @ $20/hour 28.00 Manufacturing overhead: Variable $6/lb. 0.5 lb. 3.00 Fixed $15/lb. 0.3 lb. 4.50 Standard cost per block $41.50 Actual results for April 2021 were as follows: Production 24,000 blocks Direct materials purchased 12,000 lb. at $13/lb. Direct materials used 11,450 lb. Direct manufacturing labour 38,000 hours for $798000 Variable manufacturing overhead $68,150 Fixed manufacturing overhead $155,000 calculate: For the month of April, compute the following variances, indicating whether each is favourable (F) or unfavourable (U):  a.Variable manufacturing overhead efficiency variance  b. Fixed manufacturing overhead spending variance  c. Production-volume variance

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Don Johnson is the management accountant for Cari-Blocks (CB), which manufactures
specialty blocks. CB uses two direct cost categories: direct materials and direct
manufacturing labour. Johnson feels that manufacturing overhead is most closely related to
material usage. Therefore, CB allocates manufacturing overhead to production based upon
pounds of materials used.
At the beginning of 2021, CB budgeted annual production of 200,000 blocks and adopted the
following standards for each block:
 
Direct materials 0.5 lb. @ $12/lb. $ 6.00
Direct manufacturing labour 1.4 hours @ $20/hour 28.00
Manufacturing overhead:
Variable $6/lb. 0.5 lb. 3.00
Fixed $15/lb. 0.3 lb. 4.50
Standard cost per block $41.50
Actual results for April 2021 were as follows:
Production 24,000 blocks
Direct materials purchased 12,000 lb. at $13/lb.
Direct materials used 11,450 lb.
Direct manufacturing labour 38,000 hours for $798000
Variable manufacturing overhead $68,150
Fixed manufacturing overhead $155,000

calculate:

For the month of April, compute the following variances, indicating whether each is
favourable (F) or unfavourable (U):

 a.Variable manufacturing overhead efficiency variance 
b. Fixed manufacturing overhead spending variance 
c. Production-volume variance

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