5 MARKS) TOTAL 25 MARKS QUESTION 3 Industrial Lquids manufactures liquid cleaning products from chemical raw materials. It uses the following sandand cost for production of a batch of its product Britecleen Material 200 litres at $1.10per litre 1000 litres at $0.1 10 litres at $14.20 per litre Ammonia solution per litre Fragrance agent Labour Operations Blending Mixing 8 hours at $12.00 per hour 12 hours at $8.00 per hour The actual costs for batch $4120 were Material Ammonia solution Colouning Fragrance agent 240 litres costing $216.00 950 litres costing $85.50 11 litres costing $165.00 Labour operations Blending Mixing 11 hours costing $143.00 10 hours costing $90.00 REQUIRED: Calculate the following variances from standard for Batch $4120: Material Price Variances Material Usage Variances Total Material Cost Variances v Labour Rate Variances Labour Efficiency Variances i Total Direct Labour Cost Variances [I8 MARKS b) Suggest TWO possible reasons why the labour and material variances may have occurred 9 Evaluate the usefulness of standard costing to Industrial Liquids 14 MARKS! B MARKS [TOTAL 25 MARKS END OF EXAM