Kyler manufactures coffee mugs that it sells to other companies for customizing with their own logos. Kyler prepares flexible budgets and uses a standard cost system to control manufacturing costs. The standard unit cost of a coffee mug is based on static budget volume of 59,700 coffee mugs per month: E: (Click the icon to view the cost data.) Actual cost and production information for July 2018 follows: (Click the icon to view actual cost and production information.) Read the requirements. Requirement 1. Compute the cost and efficiency variances for direct materials and direct labor. Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost; AQ = actual Formula Variance = Direct materials cost variance Direct labor cost variance i Data Table - X $ i More Info 0.05 0.39 Direct Materials ( 0.2 lbs @ $ 0.25 per lb) Direct Labor ( 3 minutes @ $ 0.13 per minute) Manufacturing Overhead: Variable ( 3 minutes @ $ 0.04 per minute) $ Fixed (3 minutes @ $ 0.14 per minute) 0.12 0.42 0.54 0.98 $ Total Cost per Coffee Mug a. There were no beginning or ending inventory balances. All expenditures were on account. b. Actual production and sales were 62,400 coffee mugs. c. Actual direct materials usage was 10,000 lbs. at an actual cost of $0.17 per lb. d. Actual direct labor usage was 203,000 minutes at a total cost of $32,480. e. Actual overhead cost was $4,060 variable and $36,440 fixed. f. Selling and administrative costs were $131,000. Print Done Print Done