Bill Wilson, the financial accountant at Robson Ltd is considering implementing a standard costing system. He has asked your advice on the following: a) Setting standards b) Investigating variances c) Taking corrective action on large variances Required: Prepare a short report for Bill addressing these three areas.

Indicate whether the items below are used as key performance indicators for the areas Quantity variance on a cost report *(A) Financial(B) Customer(C) Internal Process(D) Learning and Growth performance.

Perfect Pet Collar Company makes custom leather pet collars. The company expects each collar to require 2.35 feet of leather and predicts leather will cost $4.20 per foot. Suppose Perfect Ret made 85 collars during February. For these 85 collars, the company actually averaged 2.50 feet of leather per collar and paid $3.80 per foot. Required: 1. Calculate the standard direct materials cost per unit. 2. Without performing any calculations, determine whether the direct materials price variance will be favorable or unfavorable. 3. Without performing any calculations, determine whether the direct materials quantity variance will be favorable or unfavorable. 6. Calculate the direct materials price and quantity variances. Complete this question by entering your answers in the tabs below. Req 1 Req 2 and 3 Req 6 Calculate the standard direct materials cost per unit. Note: Round your answer to 2 decimal places. Standard Direct Materials per Collar Reg 2 and 3>