SK Manufacturing Ltd (SK) produces two products, Zico and Rico. SK expected to sell 60,000 units of Zico and 24,000 units of Rico in 2014. SK planned on having an ending inventory of 4,000 units of Zico and 2,000 units of Rico. At the start of 2014, SK had 1,500 units of Zico and 600 units of Rico in its inventory. Each product required two labour intensive processes: moulding and polishing. Zico required one hour of moulding time and 30 minutes of polishing time, while Rico required one and half hours of moulding time and two hours of polishing time. The budgeted direct labour rate for moulders was $24 per moulding hour, and the budgeted direct labour rate for polishers was $28 per polishing hour. The production manager in charge of Zico and Rico was James Tan. His performance targets for 2014 were (1) to meet production units as budgeted for 2014; and (2) ensure that labour costs variances for each product do not exceed 5% of budgeted amounts. The actual production labour costs for 2014 for Zico and Rico were $2,499,000 and $2,300,000 respectively. In total, SK produced 60,100 units of Zico and 23,900 units of Rico. Required: (a) Prepare a direct labour budget in hours and dollars for each product for 2014. (b) Evaluate if James Tan met his performance targets for 2014. Do you think James has performed well in 2014? Explain and show computations to support your evaluation. (c) Should a manager like James be held responsible for the variance in the number of units produced each year and their related labour costs? Explain and discuss.