7-28 Direct materials and direct manufacturing labor variances. SallyMay, Inc, designs and manufac- tures T-shirts. It sells its T-shirts to brand-name clothes retailers in lots of one dozen. SallyMay's May 2016 static budget and actual results for direct inputs are as follows: Static Budget Number of T-shirt lots (1 lot = 1 dozen) 400 Per Lot of Jackets: Direct materials 14 meters at S1.70 per meter = $23.80 Direct manufacturing labor 1.6 hours at $8.10 per hour = $12.96 Actual Results Number of T-shirt lots sold 450 Total Direct Inputs: Direct materials 6,840 meters at $1.95 per meter = $13,338 Direct manufacturing labor 675 hours at 88.20 per hour = $5,535 SallyMay has a policy of analyzing all input variances when they add up to more than 10% of the total cost of materials and labor in the flexible budget, and this is true in May 2016. The production manager discusses the sources of the variances: "A new type of material was purchased in May. This led to faster cutting and sewing, but the workers used more material than usual as they learned to work with it. For now, the standards are fine. 1. Calculate the direct materials and direct manufacturing labor price and efficiency variances in May 2016. What is the total flexible-budget variance for both inputs (direct materials and direct manufactur- ing labor) combined? What percentage is this variance of the total cost of direct materials and direct manufacturing labor in the flexible budget? 2. Comment on the May 2016 results. Would you continue the experiment" of using the new material