Katharine Juda is the owner of Quality Bikes, a company that produces high quality cross-country bicycles. Quality Bikes participates in a supply chain that consists of suppliers, manufacturers, distributors, and elite bicycle shops. For several years Quality Bikes has purchased titanium from suppliers in the supply chain. Quality Bikes uses titanium for the bicycle frames because it is stronger and lighter than other metals and therefore increases the quality of the bicycle. Earlier this year, Quality Bikes hired Michael Alderman, a recent graduate from State University, as purchasing manager Michael believed that he could reduce costs if he purchased titanium from an online marketplace at a lower price. (Click the icon to view the standard and actual information.) Read the requirements Requirement 1. Compute the direct materials price and efficiency variances. Let's begin by calculating the cost for the actual input at the budgeted price. Direct materials (purchases) Direct materials (usage) Actual input X Budgeted price = Cost X X