Please help me to solve this problem

Problem 10-37 Variance Computation; Santa Rosa Industries uses a standard-costing system to assist in the evaluation of operations. The com- Analysis of Performance and pany has had considerable trouble in recent months with suppliers and employees, so much so that Responsibility management hired a new production supervisor, Rohaan Johar. The new supervisor has been on the job (LO10-1, 10-3) for five months and has seemingly brought order to an otherwise chaotic situation. The vice president of manufacturing recently commented that ". . . Johar has really done the trick. The change to a new direct-material supplier and Johar's team-building/morale-boosting training exer cises have truly brought things under control." The VP's comments were based on both a plant tour, where he observed a contented workforce, and a review of the following data, which were excerpted from a performance report: Direct-material variances. $4,620 Favorable Direct-labor variances ... 6,175 Favorable These variances are especially outstanding, given that the amounts are favorable and small. (Santa Rosa's budgeted material and labor costs generally each averages about $350,000 for similar periods.) Additional data follow. The company purchased and consumed 45,000 pounds of direct materials at $7.70 per pound, and paid $16.25 per hour for 20,900 direct-labor hours of activity. Total completed production amounted to 9,500 units. A review of the firm's standard cost records found that each completed unit requires 4.2 pounds of direct material at $8.80 per pound and 2.6 direct-labor hours at $14 per hour. Required: 1. On the basis of the information contained in the performance report, should Santa Rosa be con- cerned about its variances? Why? 2. Calculate the company's direct-material variances and direct-labor variances. 3. On the basis of your answers to requirement 2, should Santa Rosa be concerned about its vari- ances? Why? 4. Are things going as smoothly as the vice president believes? Evaluate the company's variances and determine whether the change to a new supplier and Johar's team-building/morale-boosting train- ing exercises appear to be working. Explain. 5. Is it possible that some of the company's current problems lie outside Johar's area of responsibil ity? Explain