Mahn Corporation produces high-quality leather belts. The company uses a standard cost system and has set the following standards for materials and labour: During the year, Mahn produced 92,000 belts. Actual leather purchased was 287,500 strips at $3.60 per strip. There were no beginning or ending inventories of leather. Actual direct labour was 78,200 hours at $12.50 per hour. Required: 1. Compute the costs of leather and direct labour that should be incurred for the production of 92,000 leather belts. 2. Compute the total budget variances for materials and labour