Direct Materials and Direct Labor Variances - Review Hikin' and Trekkin' manufactures various outdoor apparel. Hikin' and Trekkin' wants to analyze production costs for one line of rain jackets. The direct materials and direct labor standards for one rain jacket are given below. Standard Quantity or hours Standard Price or rate Standard Cost per jacket Direct material Direct labor 2.5 yards 1.5 hours $7.50 per yard $9.00 per hour $18.75 $13.50 During the most recent month, the following activity was recorded: a. b. c. 14,000 yards of material were purchased at a cost of $8.00 per yard. 12,250 yards of material were used to produce 5,000 jackets. 7,300 hours of direct labor time were recorded at a total labor cost of $69,350. Required: 1. Calculate the direct materials price and quantity variances for the month. 2. 3. Calculate the direct labor rate and efficiency variances for the month. Explain the significance of each variance