Aunt Molly's management accountant, Karen Blair, prepares monthly bud- get reports based on these standard costs. Presented here is April's report, which compares budgeted and actual performance. Performance Report April 19 7 Budget Actual Variance Units (in pounds)* 400,000 450,000 50,000 F Revenue $3,200,000 $3,555,000 $355,000 F Direct material 580,000 865,000 285,000 U Direct labour 336,000 348,000 12,000 U *Units produced and sold. Usage Report April 19_7 Cost Item Quantity Actual Cost Direct materials: Cookie mix 4,650,000 ounces $ 93,000 Milk chocolate 2,660,000 ounces 532,000 Almonds 480,000 ounces 240,000 Direct labour: Mixing 450,000 minutes 108,000 Baking 800,000 minutes 240,000 REQUIRED 1. Compute the following variances a. Selling price variance b. Material price variance c. Material efficiency variance d. Labour price variance e. Labour efficiency variance 2. What explanations might exist for the variances in requirement 1?Comprehensive variance analysis. (CMA, adapted) Aunt Molly's Old Fashioned Cookies bakes cookies for a chain of U.K. retail stores. The com- pany's best-selling cookie is chocolate nut supreme, which is marketed as a gourmet cookie and regularly sells for $8 per pound. The standard cost per pound of chocolate nut supreme, based on Aunt Molly's normal monthly production of 400,000 pounds, is calculated as follows: Standard Cost Item Quantity Unit Costs Total Cost Direct materials: Cookie mix 10 ounces $0.02 per ounce $0.20 Milk chocolate 5 ounces 0.15 per ounce 0.75 Almonds 1 ounce 0.50 per ounce 0.50 $1.45 Direct labour:* Mixing 1 minute 14.40 per hour 0.24 Baking 2 minutes 18.00 per hour 0.60 $0.84 *Direct labour rates include employee benefits