QUESTION 7 (24 MARKS) VERIO is a producer of sanitizers for schools and has the following information for the standard and actual costs: Estimated activity & standard cost per unit The factory estimated that it would require 3 litre of material per bottle of sanitizer at an expected cost of $10.00 per litre. It also estimated to use 5 direct labour hours per bottle of sanitizer and estimated to pay wages at a rate of RM8.00 per hour. The standard variable overhead rate estimated were RM6.00 per hour. Actual activity & cost The factory manufactured 20,000 bottle of sanitizer. The factory purchased and used 58,000 litres of material at total cost of 591,600. The factory used 104,000 direct labour hours and paid at a total wage of RM842, 400. The total variable cost incurred was RM676, 000. Verio allocates its overhead on the basis on direct labour hours. Required: a) Calculate the following variances: i. All necessary direct material variances ii. All necessary direct labour variances iii. All necessary variable overhead variances (15 marks) b) Comment and discuss on all variances computed above. (9 marks)