Question 2 T.E. Toys Ltd, produces toys for national distribution. The management has recently established a standard cost system to control costs. The standards on one toy are: Materials 12 pieces per toy at $0.56 per piece Labour 2 hours per toy at $3.75 per hour During the month of February 2013, the company produced 1,000 toys. Production data for the month are as follows: Materials: 17,500 pieces were purchased for use in production, at a total cost of $8,925, of which 3,500 pieces were still in inventory at the end of the month. Labour: 2,500hours were worked, at a cost of $10,500. Required: Calculate the material price variance (3 marks) b. Calculate the material usage variance (3 marks) Calculate the labour rate variance (3 marks) d. Calculate the labour efficiency variance (3 marks) State one possible cause for the material usage variance calculated in (b) above