Question 2 (Answer BOTH Part A and Part B) Part A During the month of July 2020, Box Ltd bought 7,000 kg of materials at a price of $8.00 per kg. Actual costs incurred in the production of 7,000 units were as follows: Direct Material Direct Labour $51,200 $154,700 $8.00 per kg $13.00 per labor hour The standard cost card for one unit of Box Ltd's product shows the following information: Direct Material Standard Usage: 0.80 kg per unit Standard Price: $9.00 per kg Direct Labour Standard Labour time: 1.5 hours per unit Standard Labor Rate: $15.00 per labor hour Required: Ascertain the following operating variances, indicating as a favorable or adverse variance and briefly discuss ONE (1) possible operating cause for the variance to arise: i) Direct material price variance (3 marks) ii) Direct material usage variance (3 marks) iii) Direct labour rate variance (3 marks) iv) Direct labour effici variance marks) Part B The data below relate to another company, Coco Ltd, for the month of June 2020: Standard variable overhead rate Standard quantity of Machine Hour (MH) Budgeted fixed overhead Budgeted Output (BQ) $5 per Machine Hour 3 MH per unit $200,000 20,000 units Actual results for June 2020 are as follows: Actual Output (AQ) Actual variable overhead Actual fixed overhead Actual Machine Hours 15,000 units $220,000 $270,000 49,000 MH Required: Calculate the following variances and indicate whether each variance is favorable or adverse: i) Variable overhead expenditure variance (2 marks) ii) Variable overhead efficiency variance (2 marks) iii) Fixed overhead expenditure variance (2 marks) iv) Fixed overhead volume variance (2 marks) (Total: 20 marks)