Fletcher Company collected the following data regarding production of one of its products.Compute the direct labor efficiency variance.
A)$19,125 favorable.
B)$80,250 favorable.
C)$61,125 favorable.
D)$19,125 unfavorable.
E)$80,250 unfavorablE.AH * SR = (81,500 * $12.75)= $1,039,125

Question

Fletcher Company collected the following data regarding production of one of its products.Compute the direct labor efficiency variance. 
A)$19,125 favorable. 
B)$80,250 favorable. 
C)$61,125 favorable. 
D)$19,125 unfavorable. 
E)$80,250 unfavorablE.AH * SR = (81,500 * $12.75)= $1,039,125

Quizplus · Accepted Answer

Direct labor efficiency variance = (AH - SH) x SR
AH = Actual hours worked = 6,500
SH = Standard hours allowed for actual output = (81,500 units x 0.8 hours per unit) = 65,200
SR = Standard labor rate per hour = $12.75

Therefore,

Direct labor efficiency variance = (6,500 - 65,200) x $12.75 = $19,125 unfavorable.

Fletcher Company Collected the Following Data Regarding Production of One