Dawson Toys, Ltd., produces a toy called the Maze. The company has recently established a standard cost system to
help control costs and has established the following standards for the Maze toy:
Direct materials: 8 microns per toy at $0.32 per micron
Direct labor: 1.5 hours per toy at $6.80 per hour
During July, the company produced 5,500 Maze toys. The toy's production data for the month are as follows:
Direct materials: 74,000 microns were purchased at a cost of $0.30 per micron. 19,000 of these microns were still in inventory at the end of the month.
The labor rate and efficiency variances.