The Monroe Corporation manufactures lamps. It has set up the following standards per finished unit for direct materials and direct manufacturing labour: Eff (Click the icon to view the standards.) The number of finished units budgeted for January was 9,780; 9,650 units were actually produced. (Click the icon to view actual data.) Assume that there was no beginning inventory of either direct materials or finished units. During the month, materials purchased amounted to 97,800 kg, at a total cost of $449,880. Input price variances are isolated upon purchase. Input-efficiency variances are isolated at the time of usage. RequiredX Standards Direct materials: 10 kg. at $4.50 per kg. $ 45.00 Direct manufacturing labour: 0.5 hour at $31 per hour 15.50X Actual Data Actual results in January were as follows: Direct materials: 96,000 kg. used Direct manufacturing labour: 4,700 hours $ 153,925X Required 1. Compute the January price and efficiency variances of direct materials and direct manufacturing labour. 2. Prepare journal entries to record the variances in requirement 1. 3. Comment on the January price and efficiency variances of Monroe Corporation. 4. Why might Monroe calculate direct materials price variances and direct materials efficiency variances with reference to different points in time?Requirement 1. Compute the January price and efficiency variances of direct materials and direct manufacturing labour. Let's begin by calculating the actual input at the budgeted price. (Round your answers to the nearest whole dollar.) Actual input X Budgeted price Cost Direct materials (purchases) X Direct materials (usage) X Direct manufacturing labour X Next, determine the formula and calculate the costs for the flexible budget. = Flexible budget cost Direct materials Direct manufacturing labour Now, compute the price and efficiency variances for direct materials and direct manufacturing labour. Label each variance as favourable (F) or unfavourable (U). Price Efficiency variances variances Direct materials Direct manufacturing labourRequirement 2. Prepare journal entries to record the variances in requirement 1. Prepare the journal entry for the direct materials price variance. (Record debits first, then credits. Exclude explanations from any journal entries.) Journal Entry Date Accounts Debit Credit Next, prepare the journal entry for direct materials efficiency variance. Journal Entry Date Accounts Debit CreditNext, prepare the journal entry for direct materials efficiency variance. Journal Entry Date Accounts Debit Credit Now, prepare the journal entry for direct manufacturing labour price and efficiency variances. Journal Entry Date Accounts Debit Credit Requirement 3. Comment on the January price and efficiency variances of Monroe Corporation. A key point is that likely to be They are so Fluctuations about standards are bound to occur in a fashion. Practically, from a control viewpoint, a standard is a band or range of acceptable performance rather than a single-figure measure. Requirement 4. Why might Monroe calculate direct materials price variances and direct materials efficiency variances with reference to different points in time? The purchasing point is where responsibility for is found most often. The production point is where responsibility for is found most often. Monroe Corporation may calculate variances at different points in time to tie in with