Gwen Corporation makes a product with the following standard cost: Standard Quantity or Hours Standard Price or Rate Direct Materials Direct Labor 1.4 liters 0.7 hours $6.50 per liter $20.50 per hour Variable Overhead 0.7 hours $3.50 per hour The company produced 4,500 units in April using 6,150 liters of direct material and 2,950 direct labor hours. During the month, the company purchased 6,800 liters of direct material at $6.30 per liter. The actual direct labor rate was $21.00 per hour, and the actual variable overhead rate was $3.40 per hour. The company applies variable overhead based on direct labor hours. The direct materials purchase variance is computed when the materials are purchased. What is the labor efficiency variance for April?

Gwen Corporation makes a product with the following standard cost: Standard Quantity or Hours Standard Price or Rate Direct Materials Direct Labor 1.4 liters 0.7 hours $6.50 per liter $20.50 per hour Variable Overhead 0.7 hours $3.50 per hour The company produced 4,500 units in April using 6,150 liters of direct material and 2,950 direct labor hours. During the month, the company purchased 6,800 liters of direct material at $6.30 per liter. The actual direct labor rate was $21.00 per hour, and the actual variable overhead rate was $3.40 per hour. The company applies variable overhead based on direct labor hours. The direct materials purchase variance is computed when the materials are purchased. What is the labor efficiency variance for April?

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter9: Standard Costing: A Functional-based Control Approach

Section: Chapter Questions

Problem 30P: Algers Company produces dry fertilizer. At the beginning of the year, Algers had the following...

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