Budget Variances, Materials and Labor Cinturon Corporation produces high-quality leather belts. The company's plant in Bois uses a standard costing system and has set the following standards for materiale and labori Leather (3 strips 56.00) $18.00 Direct labor (1.25 hr $9.00) 11.25 Total prime cost $29.25 During the first month of the year, the Bolse plant produced 31,000 belts, Actunt leather purchased was 100,000 strips at $3.40 per strip. There were no beginning or ending Inventories of leather Actual direct labor was 33,000 hours at $14.00 per hour. Required: 1. Compute the costs of leather and direct labor that should be incurred for the production of 1,000 leather belts. Materials Labor 2. Compute the total budget variances for materials and tabor Total Budget Variance Materials Favorable Labor Unfavorable 3. Conceptual Connection: Would you consider these variances material with a need for investigation? Yes