Refer to the data in Exercise 10-6. Assume that instead of producing 2,500 bottles of Whim during the month, the company produced only 2,000 bottles using 16,000 ounces of material. (The rest of the material purchased remained in raw materials inventory.) Required: Compute the direct materials price and quantity variances for the month. EXERCISE 10-8 Material and Labor Variances [LO1, LO2) Topper Toys has developed a new toy called the Brainbuster. The company has a standard cost system to help control costs and has established the following standards for the Brainbuster toy: Direct materials: 8 diodes per toy at $0.30 per diode Direct labor: 0.6 hours per toy at $14.00 per hour During August, the company produced 5,000 Brainbuster toys. Production data on the toy for August follow: Direct materials: 70,000 diodes were purchased at a cost of $0.28 per diode. 20,000 of these diodes were still in inventory at the end of the month. Direct labor: 3,200 direct labor-hours were worked at a cost of $48,000. Required: 1. Compute the following variances for August: a. Direct materials price and quantity variances. b. Direct labor rate and efficiency variances. 2. Prepare a brief explanation of the possible causes of each variance. 15 connect COUNTING unilable with McGraw-Hill's Connect Accounting