Grainger Ltd makes sofa covers which are sold directly to the public via the company's website. The business has expanded over the last couple of years and has recently appointed you as management accountant to replace Mark Arthurs, the retiring office manager. To help you on your arrival, Mark Arthurs has supplied the following standard costing data, based on observations and financial records. Quantity of resource Cost per unit of resource () Standard cost per unit () Direct materials Direct Labour Total 14 m (square metres) 10 hours 20 280 11.50 115 395 Planned output for October (your first month in the post) had been 2,300 units, however, due to the current trend for refurbishing existing furniture rather than replacing it, the actual output in the month was 2,622 units. The month had, however, been challenging, with staff shortages being plugged using agency staff and fabric is difficult to source due to supply chain issues. The report of actual costs incurred in October is as follows: Quantity of resource Total Cost () Direct materials 38,019 m (square metres) 798,399 Direct Labour 31,464 hours 373,635 Total 1,172,034 In a meeting to discuss cost control in the period, Stuart Brown, the production manager, made the following statement: "in preparing for this meeting I've done some calculations: output was 14% higher than planned but our cost per unit was only 13.2% higher than standard: what a fantastic job the team's done in controlling our costs!" Required: a) Calculate the total direct materials variance and total direct labour variance, together with their respective sub-variances. (21 marks) b) Show how Stuart derived the percentages quoted in his statement and consider its validity. Discuss whether or not you agree that costs have been well controlled in the period. (4 marks)