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: Ylexible Budget Actual S 240,000 $240,000 2:24 Sales (8,000 pools) Variable expenses: Variable cost of goods sold. Variable selling expenses Total variable expenses Contribution margin Pixed expenses Manufacturing overhead Selling and administrative Total fixed expenses Net operating income (los) 94,000 10.000 104,000 136.000 112, 470 10.000 122,470 112.530 55,000 55,000 70,000 70,000 125,000 125,000 11,000 $ (7.470) *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 Price Standard Cost or Rate Standard Quantity or Hours 3.5 pounds 0.4 hours 0.2 hours Direct materials Direct labor Variable manufacturing overhead Total standard cost per unit 5 $ 2.50 per pound $ 6.50 per hour $ 2.00 per hour 8.25 2.60 0.40 11.75 5 'Based on machine-hours. 1a. Material price variance Material quantity variance 1b. Labor rate variance Labor efficiency variance 1c. Variable overhead rate variance Variable overhead efficiency variance K Required 1 R