QUESTION 2 Good Luck Ltd. has a manufacturing division which makes a product to which the following details relate: Per unit: Materials: 5 kg at E3, MS Direct labor: 10 hours at E2, Variable overhead: 10 hours at E2.10 Relevant fixed overheads are budgeted at E8,000 per month and planned output is 2,000 units per month. The selling price is E50 per unit. An incentive scheme is in operation in the division concerned whereby employees are paid a bonus of 10% of the standard cost of materials saved and 40% of direct labor time saved valued at standard direct labor hour rate. During a recent month when output was 1,700 units, the following actual results were recorded: Direct material used (8,0000 kg) = 24,800 Direct wages (18,000 hours @ E2.20 per hour) = 39,600 Variable overhead =20,000 Fixed overhead = 10,000 Required: (1). Calculate the variances which occurred during the month. (ii). Calculate the total bonus payment to the employees