QUESTION 3 (ASSIGNMENT) As a newly employed management accountant of Difficult Times Limited, you have been assigned the task of assessing the performance of a division within the company. The division, which is a mjor production centre, uses standard absorption costing for product costing and stock valuation purposes. The cost card for the product line where you interrl to start your assessment shows the following data: E Quantity 10 kgs Direct materials 105 30 minutes 15 Direct labour Category A Category B Variable overheads 45 minutes 9 20% of material 21 Fixed overheads (note) 30 minutes @ E12 per hour 6 Standard absorption cost 156 Note: Fixed production overheads are absorbed on the basis of standard time allowed for Category A labour. The monthly budget for Category A labour was 2,500 hours. In the most recent month, 4,977 units were made at the following costs: E 555,600 - Direct materials - Purchased 55,000 kgs Used 52,350 kgs Direct labour Category A 2,610 hours Category B 3,730 hours Variable overheads 114,925 Fixed overheads 77,648 45,000 29,055 Required: (a) Calculate the following variances: (i) Direct materials price and usage. (ii) Direct labour rate and efficiency variance for both categories of labour. (iii) Variable overheads expenditure and efficiexy variance. (iv) Fixed overheads expenditure and production volume variarxe. (b) Briefly comment on the information provided about the department's performiwe by the variance analysis