QUESTION $3(20$ MARKS$)$ Chairs Ltd is a company that manufactures chairs. It would like to review its variances based on standard costing. The details for the period are as follows: Actuals R Materials consumed $(5600$ units at R$75$ per unit$)$ R$420000$ Direct wages $$ R$140000$ Variable expenses $$ R$320000$ Fixed expenses R$475000$ For the above period, the standard production capacity was $5800$ units. Output during the period was $7500$ units of finished product. The break up of standard costs per unit were: Materials $($one unit at R$80$ per unit$)$ R$80$ Direct wages $$ R$10$ Variable expenses$$ R$40$Fixed exenses R$60$ TOTAL$$ R$190$ The standard wages per unit is based on $12700$ hours for the above at a rate of R$5$ per hour. Due to the continous breakdown of its machinery idle time resulted during the period under review. This resulted in $700$ hours worth of idle time to be paid and this increased the overall wage rate to R$5\mathrm{.}50$ per hour. $13500$ hours were actually worked during the period.