nuing Variances for all expense items. CIE1 Direct Materials and Direct Labor Variances [LOB-4, Lo8- EXERTOs. Ltd. produces a toy called the Maze. The company has recently established a stan Dawsn to help control costs and has established the following standards for the Maze toy company has recently established a standard cost Direct materials: 6 microns per toy at $0.50 per micron Direct labor: 1.3 hours per toy at $8.00 per hour Duning July, th g July, the company produced 3,000 Maze toys. Production data for the month on the t oy follow: materials: 25,000 microns were purchased at a cost of $0.48 per micron. 5.0 Direct 5,000 of these microns re still in inventory at the end of the month. labor: 4,000 direct labor-hours were worked at a cost of $36.000. we Required pute the following variances for July: a. The materials price and quantity variances. The labor rate and efficiency variances. Com b. Prepare a brief explanation of the possible causes of each variance. 2