Erie Company manufactures a small MP3 player called the Jogging Mate. The company uses standards to control its costs. The labour standards that have been set for one Jogging Mate MP3 player are as follows:Standard hoursStandard rate per hourStandard cost15 minutes 9.00 2.25

During August, 7,200 hours of direct labour time were recorded in the manufacture of 30,000 units of the Jogging Mate. The direct labour cost totalled 74,880 for the month.

Required:1.What direct labour cost should have been incurred in the manufacture of the 30,000 units of the Jogging Mate?

By how much does this differ from the cost that was incurred?

2.Break down the difference between direct labour cost that should have been incurred in the manufacture of the 30,000 units of the Jogging Mateand the cost that was incurred into a labour rate variance and a labour efficiency variance.(Do not round your intermediate calculations.)

3.The budgeted variable manufacturing overhead rate is 6 per direct labour hour. During August, the company incurred 41,760 in variable manufacturing overhead cost. Compute the variable overhead spending and efficiency variances for the month.(Do not round your intermediate calculations.)