Materiais Variances Cinturon Corporotion produces high-quality leather belts. The company's plant in Boise uses a standard costing system end has set the folowing skandards for matert and labors During the first month of the year, the Boise plant produced 92,000 belts. Actual leather purchased was 281,500 strips at $3,00 per strlp. There were no begimeihs or ending inventories of leather, Actual direct labor was 79,600 hours at $15.00 per hour. Required: 1. Break down the total variance for materials into a price variance and a usage variance using the columnar and formule approoches. Enter favorable valuei as negative numbers and unfavorable values as positive numbers. 2. CONCEPTUAL CONNECTION Suppose the Bolse plant manager investigates the matenals varlances and is told by the purchasing manager that a cheaper asurse of Seather strips had been discovered and that this is the reoson for the favorable materials price variance. Quate pleased, the purchasiag manager suppests that the materials price standard be updated to reflect this new, less expensive source of leather strips. Sthovid the plant manager update the materals price standord as suggested? Why or why not? 1. No, The supgestion of the purehasing manager is premature. A favorable materials price can produce an effect oo boch materais usage and abce vartunces. 2. Yes, the purchasing manager is correct. This will improve the oversil proficability of che company. 3. No, The suggestion of the purchasing manager is incorrect. The matierals are not avallabie and so changes to the price standard should not be mabe