Exercise 1 Middleton Inc is using a standard cost system to improve its operations and performance. Below is some of its direct cost standards for one of its popular products and budgeted output: Standard cost per unit: Direct material (1kg @ $15/kg) Direct labor (2 direct labor hours @ $8/DL hour) $15 $16 . Budgeted output: 65,000 units Actual results for the current month: . . Materials used Materials purchased ($11/kg) Actual hours worked Labor costs incurred Units produced 50,000 kgs 55,000 kgs 100,000 hours $875,000 45,000 units . . . 1- Calculate DM variances 2- Calculate DL variances 3. Record all direct cost journal entries