The Morgan Restaurant Group manufactures the bags of frozen French fries used at its franchised restaurants. Last week, Morgan's purchased and used 96,000 pounds of potatoes at a price of $0.65 per pound. During the week, 1,800 direct labor hours were incurred in the plant at a rate of $12.40 per hour. The standard price per pound of potatoes is $0.80, and the standard direct labor rate is $12.25 per hour. Standards indicate that for the number of bags of frozen fries produced, the factory should have used 94,000 pounds of potatoes and 1,700 hours of direct labor. Read the requirements. Requirement 1. Determine the direct material price and quantity variances. Be sure to label each variance as favorable or unfavorable. (Enter the variances as positive numbers. Enter currency amounts to the nearest cent and your answers to the nearest whole dollar. Label the variances as favorable (F) or unfavorable (U). Abbreviations used: DM = Direct materials.) Begin by determining the formula for the price variance, then compute the price variance for direct materials. DM price variance Determine the formula for the quantity variance, then compute the quantity variance for direct materials. x = DM quantity variance Requirement 2. Think of a plausible explanation for the variances found in Requirement 1. price, which resulted in the price variance. However, because One plausible explanation is that Morgan bought the potatoes were potatoes than standards allow. This accounts for the V. As a result, the manufacturing facility efficiency variance. Requirement 3. Determine the direct labor rate and efficiency variances. (Enter the variances as positive numbers. Enter currency amounts to the nearest cent and your answers to the nearest whole dollar. Label the variances as favorable (F) or unfavorable (U). Abbreviations used: DL = Direct labor.) Begin wth the the direct labor rate variance. First determine the formula for the rate variance, then compute the rate variance for direct labor. DL rate variance Now determine the direct labor efficiency variance. First determine the formula for the efficiency variance, then compute the efficiency variance for direct labor. ) = DL efficiency variance Requirement 4. Could the explanation for the labor variances be tied to the material variances? Explain. The labor rate and efficiency variances V. then the factory would use be tied to the material variances. For example, if the material variances were the result of purchasing v labor in sorting the potatoes. As a result, they would have had to pay workers 7