Standard Costs, Decomposition of Budget Variances, Direct Materials and Direct Labor Haversham Corporation produces dress shirts. The company uses a standard costing system and has set the following standards for direct materials and direct labor (for one shirt): Fabric (1.5 yds. @ $2.80) $4.20 Direct labor (1.1 hr. @ $20) 22.00 Total prime cost $26.20 During the year. Haversham produced 9,700 shirts. The actual fabric purchased was 14,450 yards at $2.72 per yard. There were no beginning or ending inventories of fabric. Actual direct labor was 10,790 hours at $19.50 per hour. Required: 1. Compute the costs of fabric and direct labor that should have been incurred for the production of 9.700 shirts. Direct materials S 40,740 Direct labor $ 213,400 2. Compute the total budget variances for direct materials and direct labor. Direct materials Favorable Direct labor Favorable 3. Break down the total budget variance for direct materials into a price variance and a usage variance. Materials Price Variance 1,156 Favorable Materials Usage variance Favorable Prepare the journal entries associated with these variances. If an amount box does not require an entry, leave it blank or enter "0". Price Variance Materials Direct Materials Price Variance Accounts Payable 110 100 100 Usage Variance Work in Process Direct Materials Usage Variance Materials Feedback th 4. Break down the total budget variance for direct labor into a rate variance and an efficiency variance. Labor Rate Variance Favorable Labor Efficiency Variance Unfavorable Feedback Prepare the journal entries associated with these variances. If an amount box does not require an entry, leave it blank or enter "0". Prepare the journal entries associated with these variances. If an amount box does not require an entry, leave it blank or enter "O". Work in Process Direct Labor Efficiency Variance Direct Labor Rate Variance Wages Payable