CarmeQisya & Co operates a variance accounting system, producing a single product which is an instant shawl with abaya. The monthly budget is to make and sell 10,000 units of a single product which has the following standard production unit cost details:- Direct Material 8.00 meter RM 10.80 per meter Direct Labour 1.25 hours RM 18.00 per hour Variable Overhead 1.25 hours RM 6.00 per hour Fixed Overhead 1.25 hours RM13.60 per hour Currently the standard selling price of the product is RM180 per unit. The following actual data was recorded for the June 2021. Units produced and sold - 9,000 Actual total sales - RM1,656,000 Materials purchased and used- 74,000 meters at a total cost of RM828,800 Direct Labour - 10,910 hours paid, costs RM 205,200 10,800 hours worked. Actual variable overheads - RM 70,000 Actual fixed overheads - RM 168,000 Required: a. Calculate ALL variances and prepare and operating statement for the month ending 30 June 2021. (20 marks)

b. Critically evaluate the importance of setting standards in management accounting.