Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct labor-hours and its standard cost card per unit is as follows: Direct materials: 6 pounds at $8 per pound Direct labor: 4 hours at $13 per hour Variable overhead: 4 hours at $5 per hour Total standard cost per unit $ 48 52 20 $ 120 The planning budget for March was based on producing and selling 20,000 units. However, during March the company actually produced and sold 25,500 units and incurred the following costs: a. Purchased 170,000 pounds of raw materials at a cost of $7.20 per pound. All of this material was used in production. b. Direct laborers worked 73,000 hours at a rate of $14 per hour. c. Total variable manufacturing overhead for the month was $427,050. 10. What is the labor efficiency variance for March? Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zer variance.). Input all amounts as positive values. Labor efficiency variance
Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct labor-hours and its standard cost card per unit is as follows: Direct materials: 6 pounds at $8 per pound Direct labor: 4 hours at $13 per hour Variable overhead: 4 hours at $5 per hour Total standard cost per unit $ 48 52 20 $ 120 The planning budget for March was based on producing and selling 20,000 units. However, during March the company actually produced and sold 25,500 units and incurred the following costs: a. Purchased 170,000 pounds of raw materials at a cost of $7.20 per pound. All of this material was used in production. b. Direct laborers worked 73,000 hours at a rate of $14 per hour. c. Total variable manufacturing overhead for the month was $427,050. 10. What is the labor efficiency variance for March? Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zer variance.). Input all amounts as positive values. Labor efficiency variance
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Am. 1110.
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Required information
[The following information applies to the questions displayed below.]
Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct
labor-hours and its standard cost card per unit is as follows:
Direct materials: 6 pounds at $8 per pound
Direct labor: 4 hours at $13 per hour
Variable overhead: 4 hours at $5 per hour
Total standard cost per unit
$ 48
52
20
$ 120
The planning budget for March was based on producing and selling 20,000 units. However, during March the company
actually produced and sold 25,500 units and incurred the following costs:
a. Purchased 170,000 pounds of raw materials at a cost of $7.20 per pound. All of this material was used in production.
b. Direct laborers worked 73,000 hours at a rate of $14 per hour.
c. Total variable manufacturing overhead for the month was $427,050.
10. What is the labor efficiency variance for March?
Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero
variance.). Input all amounts as positive values.
Labor efficiency variance](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F0c0cc6c9-7aea-4676-bfd2-3feaa3026371%2F5c438daa-da65-4a48-99bb-acf6e15da245%2Fkwhhun_processed.png&w=3840&q=75)
Transcribed Image Text:!
Required information
[The following information applies to the questions displayed below.]
Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct
labor-hours and its standard cost card per unit is as follows:
Direct materials: 6 pounds at $8 per pound
Direct labor: 4 hours at $13 per hour
Variable overhead: 4 hours at $5 per hour
Total standard cost per unit
$ 48
52
20
$ 120
The planning budget for March was based on producing and selling 20,000 units. However, during March the company
actually produced and sold 25,500 units and incurred the following costs:
a. Purchased 170,000 pounds of raw materials at a cost of $7.20 per pound. All of this material was used in production.
b. Direct laborers worked 73,000 hours at a rate of $14 per hour.
c. Total variable manufacturing overhead for the month was $427,050.
10. What is the labor efficiency variance for March?
Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero
variance.). Input all amounts as positive values.
Labor efficiency variance
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