(B). URBAN AMBITIONS is a company that manufactures clothing including African-wear shirts for the middle class workforce in Ghana. The company uses a standard cost system to assist in the control of costs. An African-wear shirt has a standard direct material, direct labour and variable overhead costs respectively as follows: 2.8 yards of material at GH6.50 per yard - GH18.20 per shirt. 0.4 hours of direct labour at GH9.00 per hour-GH3.60 per shirt. 0.4 hours of direct labour hours at GH3.00 per hour GH1.20 per shirt. Fixed overheads are absorbed on the basis of direct labour hours and added to product cost at the rate of GH2.00 per shirt. The standard full cost of producing a shirt is GH25.00 During the month of April, the factory worked 760 direct labour hours and produced 2,000 units of African-wear shirts. The following actual costs were recorded. 6,000 yards of material which cost GH36,000 were purchased and used for the production of the 2,000 shirts, and the direct labour costs associated with the 760 hours worked was GH47.600. The total variable production cost for the month was GH3,800. All of the material purchased during the month was used in production, The company budgeted to sell 1,800 shirts in the following month for GH30.00 per shirt. However, actual sales recorded was 1,900 shirts at GH28.50 per shirt. REQUIRED: Compute the following variances for this period of the companies operation, providing summary statements where necessary (a) (i) The direct material total variance 2 marks (ii) The direct material price variance and 2 marks (iii) The direct material usage variance 2 marks (iv) Who is responsible for direct material usage variances? 1 mark (b) (i) The direct labour total variance (ii) The direct labour rate variance and 2 marks 2 marks created with n nitro PDF professional (iii) The direct labour efficiency variance 2 marks (c) (i) The selling price variance (11) The sales volume profit variance 2 marks 3 marks (d) Give one reason each for possible causes of the material price variance and usage variances 2 marks