Jacky's Pastries expected to use 1.5 pounds of direct materials to produce 1 unit(batch) of product at a cost of $2 per pound. Actual results are in for last year which indicates 390,000 batches of pastries were sold. The company purchased 640,000 pounds of materials at $1.80 per pound and used 624,000 pounds in production. Jacky's pastries expected to used 0.20 direct labour hours to produce 1 unit(batch) of product at a cost of $12 per hour. Actual results are in for last year, which indicates 390,000 batches of pastries were sold. The company's direct labour workforce worked 97,500 hours at $11 per hour.

1. Calculate the material price and quantity variances.

2. Calculate the labour rate of efficiency variances

3. What is flexible budget and why do companies use a flexible budget to evaluate production managers

4. Companies often use standard costs for planning and control purposes. What are standard costs and how is it different from budgeted cost?