Question 1 During June, Fraser Company's material purchases amounted to 6,000 pounds at a price of $7.35 per pound. Actual costs incurred in the production of 2,000 units were as follows: Direct labor: $116,935 ($18.20 per hour) Direct material: $32,340 ($7.35 per pound) The standards for one unit of Fraser Company's product are as follows: Direct labor: Quantity, 3.1 hours per unit Rate, $18 per hour Direct material: Quantity, 2.1 pounds per unit Price, $7.10 per pound Required: Compute the following variances and indicate whether each variance is favorable or unfavorable. 1. Direct material price variance 2. Direct material quantity variance 3. Direct labor rate variance 4. Direct labor efficiency variance Question 2 Explain the meaning of management by exception with an example