Labour and Variable Overhead Variances (7 marks) Erie Co. manufactures an MP3 player and uses standard costs. The labour standards 18 minutes per unit at a standard labour rate of $12.00. 5,750 hours of direct labour were recorded in the manufacture of 20,000 units during August. The actual direct labour cost was $73,600. Required: 1. What is the flexible budget (standard) for direct labour cost in the manufacture of 20,000 units? 2. Calculate the labour rate and efficiency variances. 3. The budgeted variable manufacturing overhead rate is $4.00 per direct labour hour. During August, the company incurred $21,850. Compute the spending and efficiency variances