5.) Babylon Corporation manufactures luxury sofa sets and uses a standard cost system. It allocates overhead costs based on quantity of direct materials. The companys performance report for January includes the following selected data. Static Budget (300 sofa sets) Actual Production (280 sofa sets) Explanations Sales Revenue $ 500,000 300 x $2000 $532,000 280 x $1900 Variable manufacturing costs: Direct Materials 62,100 9,000 meters x $6.90 56,079 8,370 meters x $6.70 Direct Labor 79,200 9,900 hrs x $ 8.00 71,604 9,180 hrs x $ 7.80 Variable Manufacturing Ovh 27,000 9,000 meters x $ 3.00 28,458 8,370 meters x $ 3.40 Fixed manufacturing costs: Fixed Manufacturing Ovh. 90,000 90,000 Compute total, price and quantity (efficiency) variances for direct materials and direct labor and total, controllable and volume variances for manufacturing overhead

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