Raging Sage Coffee is a franchise that sells cups of coffee from a cart in shopping centres. A computerised standard costing

system is provided as a part of the franchise package. A portion of the standard cost data follows.

In its first month of operation, the Launceston franchise recorded the following data:

The entity's policy is to record materials price variances at the time materials are purchased.

Required

$($a$)$ Are direct labour hours for the cart most likely fixed or variable? Explain.

$($b$)$ Given your answer to part $($a$),$ should a direct labour efficiency variance be calculated? Why?

$($c$)$ Calculate the direct materials price and efficiency variances.

$($d$)$ How many cups of coffee did the franchise owners expect to sell this period? Compare this estimate to the amount actually

sold.

$($e$)$ Provide possible explanations for the drop in sales.

$($f$)$ Suppose the clerks$/$brewers currently receive a bonus based on their ability to control costs as measured using cost