3. Exeter Inc produces a product called AB12. The manager of the company states that the standard amount of raw material required to manufacture one unit of AB12 is 3 kg and the standard price set for buying the raw material is $8.5. The manager of the company also sets standard that each unit of AB12 will require 2.5 hours of direct labours and sets a standard direct labour hourly rate of $12. During the current month, 25,000 kgs of raw materials was purchased at a total cost of $237,500. 2,000 units of AB12 was manufactured by using 22,800 kgs of raw materials. A total of 4500 direct labour hours were used to manufacture the 2,000 units of AB12, at a total cost of $54,000. Page 3 of 5 Required: . Calculate both material related variances and comment on your answer. (Show workings clearly) 10 Marks b. Calculate both labour variances and comment on your answer. (Show workings clearly) 6 Mark