Just 1a and 1b please

PROBLEM 10-9 Comprehensive Variance Analysis (LO1, LO2, L03] Portland Company's Ironton Plant produces precast ingots for industrial use. Carlos Santiago, who was recently appointed general manager of the Ironton Plant, has just been handed the plant's contribution format income statement for October. The statement is shown below: Budgeted Actual Sales (5,000 ingots) $250,000 $250,000 Variable expenses: Variable cost of goods sold" 96,390 Variable selling expenses 20,000 20,000 Total variable expenses. 100,000 116,390 Contribution margin 150,000 133,610 Fixed expenses: Manufacturing overhead.. 60,000 60,000 Selling and administrative. 75,000 75,000 Total fixed expenses. 135,000 135,000 Net operating income (loss). $ 15,000 $ (1,390) 80,000 Contains direct materials, direct labor, and variable manufacturing overhead. Mr. Santiago was shocked to see the loss for the month, particularly because sales were exactly as budgeted. He stated, "I sure hope the plant has a standard cost system in operation. If it doesn't I won't have the slightest idea of where to start looking for the problem." The plant does use a standard cost system, with the following standard variable cost per ingot: Direct materials.... Direct labor..... Variable manufacturing overhead. Total standard variable cost. Based on machine-hours Standard Quantity Standard Price Standard or Hours or Rate Cost 4.0 pounds $2.50 per pound $10.00 0.6 hours $9.00 per hour 5.40 0.3 hours $2.00 per hour 0.60 $16.00 During October the plant produced 5,000 ingots and incurred the following costs: a. Purchased 25,000 pounds of materials at a cost of $2.95 per pound. There were no raw materi- als in inventory at the beginning of the month. b. Used 19,800 pounds of materials in production. (Finished goods and work in process invento- ries are insignificant and can be ignored.) c. Worked 3,600 direct labor-hours at a cost of $8.70 per hour. d. Incurred a total variable manufacturing overhead cost of $4,320 for the month. A total of 1.800 machine-hours was recorded. It is the company's policy to close all variances to cost of goods sold on a monthly basis. Required: 1. Compute the following variances for October: a. Direct materials price and quantity variances. b. Direct labor rate and efficiency variances