1. Gina in the King's Road Inc., makes naugahyde couches. The company uses two main materials to make the furniture, wood and leather. The company's standard costs for materials and labor are as follows (wood in boards and leather in pounds, variable/fixed overhead based on machine hours). Overhead costs are allocated to production based on machine hours. Standard Quantity Standard Cost Standard Price Or Hours or Rate Wood $5.70 per board $51.30 9 boards Leather 65.60 8 pounds $8.20 per pound $12.00 per DL hour Direct Labor Variable Manufacturing Overhead Fixed Manufacturing Overhead 6.00 0.5 DL hours $5.00 per M hour $ 60.00 per M hour 1.50 0.3 M hours 18.00 0.3 M hours (Note: Denominator level of 900 M hours, budgeted production 3000 units, and budgeted fixed overhead of $ 54,000.) Total standard cost per unit $142.40 The months results are as follows: Production and sales 2500 units. Actual fixed overhead costs incurred were $ 60,000, Purchases of wood this month were 18,000 boards for $ 5.80 each, the wood beginning inventory consisted of 5,000 boards at a total cost of $ 28,500, the month's ending inventory was 2,500 boards. Purchases of leather this month were 22,600 pounds for $ 7.95 each, the leather beginning inventory was 2,000 pounds at a total cost of $ 16,400, the month's ending inventory was 1,000 pounds. Finished goods and work in process inventories are insignificant and can be ignored. Assembly workers worked 1,550 direct labor hours at a cost of $ 11.40 a DL hour. 800 machine hours were used at an average variable overhead cost of $ 5.20 a machine hour. It is the company's policy to close all variances to cost of goods sold on a monthly basis. Compute the company's Material variances for price and efficiency separately each for wood and for leather, the labor price and efficiency variances, and the fixed and variable overhead spending and efficiency/production volumne variances. Was fixed manufacturing overhead over or under allocated