Budget Variances, Materials and Labor Cinturon Corporation produces high-quality leather belts. The company's plant in Boise uses a standard costing system and has set the following standards for materials and labor: Leather (4 stros $4.00) Direct labor (1.25 hr. Total prime cost $16.00 $11.00) 13.75 29.75 During the first month of the year, the Boise plant produced 31,000 belts. Actual leather purchased was 130,000 strips at $3.30 per strip. There were no beginning or ending inventories of leather. Actual direct labor was 35,00D hours at $15.00 per hour Required: L. Compute the costs of leather and direct labor that should be incurred for the production of 31,000 leather belts Materials Labor 2. Compute the totalbget variances for materials and labor. Total Budget Variance Favorable Materials Labor 3. Conceptual Connection: Would you consider these variances material with a need for investigation? Unfavorable V Yes Check My Work 3. Examine interrelationships with materials and labor. Consider what is a significant deviation from standard