17 E 100 4 points Gamma Manufacturing has prepared the following flexible budget for October and it is in the process of interpreting the variances. F denotes a favorable variance and U denotes an unfavorable variance. Material A Material B Direct labor Variances Flexible Budget Price/Rate Use/Efficiency $20,000 $1,000 F $3,000 U 30,000 500 U 1,500 F 40,000 500 U 2,500 F The most likely explanation of the above direct labor variances is that: the company may have assigned more experienced employees this month than originally planned management may have a problem with budget slack and may be using lax standards for both labor wage rates and ected efficiency employees did not work as efficiently as expected to accomplish the job the average wage rate paid to employees was less than expected