Grand Guard, which used a standard cost accounting system, manufactured 240,000 boat fenders during the year, using 1,780,000 feet of extruded vinyl purchased at $1. 10 per foot Production required 4.700 direct labor hours that cost $12.00 per hour. The materials standard was 7 feet of vinyl per fender at a standard cost of $120 per foot. The labor standard was 0 022 direct labor hour per fender at a standard cost of $11.00 per hour Read the requirements Requirement 1. Compute the price and quantity variances for direct materials. Compute the rate and efficiency variances for direct labor (Enter the variances as positive numbers Enter currency amounts to the nearest cent and your answers to the nearest whole dollar. Label the variances as favorable (F) or unfavorable (U) Abbreviations used. DM = Direct materials, DL - Direct labor.) Begin with the variances for direct materials. First, determine the formula for the direct materials price variance, then compute the price variance for direct materials. (Assume that the quantity of materials purchased is equal to the quantity of materials used) Actual quantity purchased Standard price Actual price DM price vanance Determine the formula for the direct materials quantity variance, then compute the quantity variance for direct materials. DM quantity variance Next, compute the vanances for direct labor First, determine the formula for the rate variance, then compute the rate variance for direct labor DL rate variance Determine the formula for direct labor the efficiency variance, then compute the efficiency variance for direct labor De efficiency variance Requirement 2. Does the pattern of varances suggest that the company's managers have been making trade-offs? Explain