Catch a Wave Company manufactures surfboards. Its standard cost information follows: Standard… 1 answer below »

Catch a Wave Company manufactures surfboards. Its standard cost information follows:

Standard Standard Price Standard Unit

Quantity (Rate) Cost

Fiberglass 15 sq. ft. $5 per sq. ft. $75.00

Direct labor 10 hrs $15 per hour 150.00

Variable manufacturing overhead $6 per direct labor hour 60.00

Fixed manufacturing overhead $8 per direct labor hour 80.00

The company expected to require 2,500 hours of direct labor.

Catch a Wave has the following actual results for the month of June:

Number of units produced and sold 260

Number of square feet of fiberglass used 4,100

Cost of fiberglass purchased (5,000 square feet) $24,500

Number of labor hours worked 2,550

Direct labor cost $39,525

Variable overhead cost $14,790

Fixed overhead cost $20,500

Required:

a) Compute the eight variances that were discussed in class.

b) Explain what these variances may be indicating.