$7-28$ Direct materials and direct manufacturing labor variances. Rugged Life, Inc., designs and manufactures fleece quarter$-$zip jackets. It sells its jackets to brand$-$name outdoor outfitters in lots of one dozen. Rugged Life$$s May $2017$ static budget and actual results for direct inputs are as follows:

$$

Static Budget

$$

Number of jacket lots $(1$ lot $=1$ dozen$)$

$300$

Per Lot of Jackets:

$$

Direct materials

$18$ yards at $$4\mathrm{.}65$ per yard $=$ $$83\mathrm{.}70$

Direct manufacturing labor

$2\mathrm{.}4$ hours at $$12\mathrm{.}50$ per hour $=$ $$30\mathrm{.}00$

Actual Results

$$

Number of jacket lots sold

$325$

Total Direct Inputs:

$$

Direct materials

$6,500$ yards at $$4\mathrm{.}85$ per yard $=$ $$31,525$

Direct manufacturing labor

$715$ hours at $$12\mathrm{.}60=$ $$9,009$

$$

Rugged Life has a policy of analyzing all input variances when they add up to more than $8\%$ of the total cost of materials and labor in the flexible budget, and this is true in May $2017.$ The production manager discusses the sources of the variances: $$A new type of material was purchased in May. This led to faster cutting and sewing, but the workers used more material than usual as they learned to work with it$.$ For now, the standards are fine.$$

$$

Required:

$1.$ Calculate the direct materials and direct manufacturing labor price and efficiency variances in May $2017.$ What is the total flexible$-$budget variance for both inputs $($direct materials and direct manufacturing labor$)$ combined? What percentage is this variance of the total cost of direct materials and direct manufacturing labor in the flexible budget?

$2.$ Comment on the May $2017$ results. Would you continue the $$experiment$$ of using the new material?