Best, Inc. produced 1,000 units of the company's product in 2024. The standard quantity of direct materials was three yards of cloth per unit at a standard cost of $1.05 per yard. The accounting recotds showed that 2,900 yards of cloth were used and the company paid $1.10 per yard. Standard time was two direct labor hours per unit at a standard rate of $12.50 per direct labor hour. Employees worked 1,400 hours and were paid $12.00 per hour. Read the Standard costing helps managers do the following: Requirement 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances. Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost; AQ = actual quantity; FOH= fixed overhead; SC= standard cost; SQ= standard quantity.) Requirements 1. What are the benefits of setting cost standards? 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances. labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations = actual quantity; FOH = fixed overhead; SC = standard cost; SQ = standard quantity.)