asuras Waste Disposal company has a long-term contract with several large cities to collect garbage and trash from residential customers. To facilitate the collection, Basuras places a large plastic container with each household. Because of wear and tear, growth, and other factors, Basuras places about 200,000 new containers each year (about 20% of the total households). Several years ago, Basuras decided to manufacture its own containers as a cost-saving measure. A strategically located plant involved in this type of manufacture was acquired. To help ensure cost-efficiency, a standard cost system was installed in the plant. The standards have been established for the product's variable inputs and are contained in this Google spreadsheet. Also shown in the spreadsheet are the actual results for the first week of January.(This assignment is derived from Problem 10-63 at the end of Chapter 10.)Make a copy of this Google spreadsheet and share it with editing capability with the instructor.Suppose that you have been asked to advise on the material, labor, and overhead costs related to the following information:The purchasing agent located a new source of slightly higher-quality plastic, and this material was used during the first week in January. Also, a new manufacturing process was implemented on a trial basis. The new process required a slightly higher level of skilled labor. The higher-quality material has no effect on labor utilization. However, the new manufacturing process was expected to reduce materials usage by 0.25 pounds per container.Compute the materials price variance for January by filling in the appropriate green highlighted cells. Determine if the variance is favorable (less than standard) or unfavorable (more than standard).Compute the materials usage variance for January by filling in the appropriate green highlighted cells. Determine if the variance is favorable (less than standard) or unfavorable (more than standard).Assume that the 0.25 pounds per container reduction of materials occurred as expected and that the remaining effects are all attributable to the higher-quality material. Explain whether you would recommend that the purchasing agent continue to buy this quality, or should the usual quality be purchased? Assume that the quality of the end product is not affected significantly.Compute the labor rate variance for January by filling in the appropriate green highlighted cells. Determine if the variance is favorable (less than standard) or unfavorable (more than standard).Compute the labor efficiency variance by filling in the appropriate green highlighted cells. Determine if the variance is favorable (less than standard) or unfavorable (more than standard).Assume that the labor variances are attributable to the new manufacturing process, explain whether it should be continued or abandoned. In answering, consider the new process's materials reduction effect as well.Suppose that the industrial engineer argued that the new process should not be evaluated after only one week. His reasoning was that it would take at least a week for the workers to become efficient with the new approach. Suppose that the production is the same the second week (6,000 units) and that the actual labor hours were 9,000 and the labor rate was $11.00 per hour. Explain whether the new process should be adopted.Assuming production of 6,000 units per week, identify the projected annual savings. (Include the materials reduction effect.)

Standard Standard Price Standard Quantity (rate in $) Cost Direct materials 12 lbs. $ 3.50 $42.00 Direct labor 1.70 hrs. 11.00 18.70 Variable overhead 1.70 hrs. 3.00 5.10 Total $65.80 Details During the first week in January, Basuras had the following actual results: Units produced 6,000 Actual labor costs $118,800 Actual labor hours 10,800 Materials purchased and used 69,000 Ibs. @ $3.55 Actual variable overhead costs $39,750