Concita Ltd. uses a standard cost system and sets predetermined overhead rates on the basis of direct labour hours. The companVs budget indicates the following data for the current year. Denominator activity Variable manufacturing overhead (10,000 direct labour hours @$3.42) Fixed manufacturing overhead cost Predetermined overhead rate ( direct labour hours) The standard cost card for the company's only product is given below: Direct materials Direct labour Variable overhead Fixed overhead Total standard cost Standard Quantity or hours 4 kilograms 2 direct labour hours 2 direct labour hours 2 direct labour hours Standard price or rate $2.60 per kilogram $8 per direct labour hour $3.42 per direct labour hour $7 per direct labour hour 5,000 units $34,200 $70,000 $10.42 Standard cost Per Unit $10.40 16.00 6.84 14.00 $47.24 During the year, the company produced 4,800 units of product and incurred the following costs: Direct materials purchased Direct materials used. Direct labour Variable manufacturing overhead cost Fixed manufacturing overhead cost Required (show your workings): Quantity 30,000 kilograms 20,000 kilograms 10,000 hours 1. 2. 3. 4. 5. 6. 7. 8. Calculate favourable or unfavourable price & efficiency variance for direct materials Give a plausible explanation for the variance occurred for direct materials Calculate favourable or unfavourable price & efficiency variance for direct labour Give a plausible explanation for the variance occurred for direct labour Calculate favourable or unfavourable Spending & Efficiency variance for Variable MOH Give a plausible explanation for the variance occurred for Variable MOH Calculate favourable or unfavourable Budget & Volume variance for Fixed MOH Give a plausible explanation for the variance occurred for Fixed MOH Amount $81,000 $86,000 $35,900 $64,800 16 marks 9 marks 16 marks 9 marks 16 marks 9 marks 16 marks 9 marks