Question 2 (25 Marks) Toy Factory manufactures a special superhero rubber toy. Overhead is applied to the the basis of direct-labour hour. The following stane Direct materials: 0.6 kg of rubber per toy at So.1 per kg Direct labour: 0.1 hour per toy at $17 per hour Variable manufacturing overhead: 0.1 hour per toy at $5 per hour Fixed manufacturing overhead: 0.1 hour per toy at $4 per hour During the year the company produced 30,000 superhero rubber toys using its 1,000 kg of rubber remaining in last year's ending inventory. The fixed overhead budget for the year was $24,000 Actual data for the production for the year is as follows: Direct Materials: 20,000 kilograms of rubber was purchased at a cost of S0.3 per kg, 4,000 kg of the rubber was still in the inventory at the end of the month. Direct labour: 5,000 DLH hours were worked at $75,000 Variable manufacturing overhead costs were $15,000 Fixed manufacturing overhead costs were $30,000 Required: a) Compute the materials, labour, and overhead variances. (15 marks) b) Were the overhead costs overapplied or underapplied? (5 marks) c) What are the advantages and disadvantages of capacity analysis in regard to variance analysis (5 marks) x Actual Pmi