1 Nestl, manufacturer of Purina Dog Chow, produces its product in 500-bag batches. Assume the standard batch consists of 10,000 pounds of direct materials at $0.25 per pound, 16 direct labor hours at $15 per hour, and variable overhead cost (based on machine hours) at the rate of $20 per hour with 10 machine hours per batch. The following variable costs were incurred for the last 500-bag batch produced Direct materials purchased and actually used 10,250 Direct materials purchased and actually used cost $2,255 Direct Labor hours used 15 Direct labor hours used total cost $231 Variable overhead actual cost $215 Machine hours actually used 9.5 For parts a and b, use Sheet 2 of this spreadsheet. a. Determine the actual and standard variable costs per bag of dog food produced, separated into direct materials, direct labor, and variable overhead. b. For the last 500-bag batch, determine the standard cost variances for direct materials, direct labor, and variable overhead For part c, type your answers on a word document and upload along with this spreadsheet. c. Explain the possible causes for each of the variances determined in requirement (b). Equations you may need Materials Price Variance AMQ(AMP-SMP) Materials Quantity Variance SMP(AMQ-SMQ) Labor rate Variance ALH(ALR-SLH) Labor efficiency variance SLR(ALH-SLH) Variable overhead spending variance AVP-(AVHxSVR) Variable overhead efficiency variance SVR(AVH-SVH)