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Decadent Halloween Candy Co

Accounting

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Decadent Halloween Candy Co. (DHC) produces specialty Halloween treats in large batches. One batch of treats has the following standard costs and amounts:

Standard kilograms of sugar 100 Standard cost per kilogram of sugar $1.90 Standard direct labour hours 2 Standard direct labour cost per hour $18.00 DHC produced 400 batches of treats in October. Actual input costs and per batch usage levels were as follows: Actual kilograms of sugar purchases and used 102 Actual cost per kilogram of sugar $2.10 Actual direct labour hours 1.8 Actual direct labour cost per hour $17.50

DHC produced 400 batches of treats in October. Actual input costs and per batch usage levels were as follows: Actual kilograms of sugar purchases and used 102 Actual cost per kilogram of sugar $2.10 Actual direct labour hours 1.8 Actual direct labour cost per hour $17.50

Required: Calculate the direct materials price and quantity variances, and the direct labour rate and efficiency variances. For each variance, provide a reasonable explanation of what may have caused the variance to occur, and why it would result in a favourable or unfavourable variance.