3) Venazio Products uses a standard costing system to assist in the evaluation of operatlo company has had considerable employee difficulties in recent months, so much so that managemen has hired a new production supervisor (Ralph Moreno) Moreno has been on the job for six months and has seemingly brought order to an otherwise chaotic situation Cedent of manufacturing rocently commented that "Morono has rcally done the trick Ralph's team-building/morale-boosting exercises have truly brought things under control." The vice-president's comments were based on both a plant tour, where he observed a contented work force, and review of a performance report that showed a total labor variance of $14,000F. This riance is truly outstanding, given that it is less than 2% of the company's budgeted labor cost Additional data follow. Total completed production amounted to 20,000 units. review of the firm's standard cost records found that each completed unit requires 2.75 hours of at S14 per hour. Venazio's production actually required 42,000 labor hours at a total cost of $756,000 Required: A. As judged by the information contained in the performance report, should the vice-president be concerned about the company's labor variances? Why? B. Calculate Venazio's direct-labor variances C. On the basis of your answers to requirement "B," should Venazio be concerned about its labor situation? Why? D. Briefly analyze and explain the direct-labor variances. 4) Neosho Corporation's Gauge Division manufactures and sells product no. 24, which is used in refrigeration systems. Per-unit variable manufacturing and selling costs amount to $23 and respectively. The Division can sell this item to external domestic customers for $40 or alternatively, transfer the product to the company's Refrigeration Division. Refrigeration is currently purchasing a similar unit from Taiwan for $36. Assume use of the general transfer-pricing rule $7 Required: A. What is the most that the Refrigeration Division would be willing to pay the Gauge Division for unit? B. If Gauge had excess capacity, what transfer price would the Division's management set? C. If Gaugc had no cxecss capacity, what transfer price would the Division's management sct? D. Repeat part "C," assuming that Gauge was able to reduce the variable cost of internal transfers b $5 per unit