Miller Toy Company manufactures a plastic swimming pool at its Westwood Plant. The plant has been experiencing problems as shown by its June contribution format income statement below: Flexible Budget Actual Sales (3,000 pools) Variable expenses: $225,000 $225,000 Variable cost of goods sold* Variable selling expenses Total variable expenses Contribution margin Fixed expenses: 44,520 21,000 56,975 21,000 65,52099 77,975 159,480 147,025 62,000 87,000 149,000 149,000 Manufacturing overhead 62,000 87,000 Selling and administrative Total fixed expenses Net operating income (loss) $10,480 $ (1,975) *Contains direct materials, direct labor, and variable manufacturing overhead. Janet Dunn, who has just been appointed general manager of the Westwood Plant, has been given instructions to "get things under control." Upon reviewing the plant's income statement, Ms. Dunn has concluded that the major problem lies in the variable cost of goods sold. She has been provided with the following standard cost per swimming pool Standard Standard Price Standard Quantity or or Rate Cost Hours Direct materials Direct labor Variable manufacturing overhead Total standard cost per unit 3.7 pounds 2.30 per 0.6 hours pound $ 8.51 4.68 1.65 $ 7.80 per hour 3.30 per hour 0.5 hours* $ 14.84