SE23-18 (similar to) O 1 %E23-18 (similar to) All-Star, Inc. produced 1,000 units of the company's product in 2016. The standard quantity of direct materials was three yard yard. Standard time was two direct labor hours per unit at a standard rate of $9.75 per direct labor hour. Employees worked 1,9 Requirements 1. What are the benefits of setting cost standards? 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cos Requirement 1. What are the benefits of setting cost standards? Standard costing helps managers do the following: Prepare the master budget Set target levels of performance for flexible budgets Identify performance standards Set sales prices of products and services Decrease accounting costs Requirement 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labc Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and standard cost: SQ = standard quantity.) Formula Variance Direct materials cost variance (AC-SC) AQ Direct labor cost variance (AC-SC) x AQ Question Help The standard quantity of direct materials was three yards of cloth per unit at a standard cost of $1.05 per yard. The accounting records showed that 2,500 yards of cloth were used and the company paid $1.10 per te of 59.75 per direct labor hour. Employees worked 1,900 hours and were paid $9.25 per hour materiais efficiency variance as well as the direct labor cost and efficiency variances irect materiais efficiency variance as well as the direct labor cost and efficiency variances he cost variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (Ul. (Abbreviations used: AC-accost AG - actually: FOH Beed over SC Variante