Bonnot Corporation makes a product that has the following direct labor standards: The company budgeted for production of 2,100 units in October, but actual production was 1,900 units. The company used 410 direct labor-hours to produce this output. The actual direct labor rate was $20.60 per hour.
-The labor efficiency variance for October is:
A)$618 U
B)$630 F
C)$618 F
D)$630 U

Question

Bonnot Corporation makes a product that has the following direct labor standards:  The company budgeted for production of 2,100 units in October, but actual production was 1,900 units. The company used 410 direct labor-hours to produce this output. The actual direct labor rate was $20.60 per hour.
-The labor efficiency variance for October is:
A)$618 U 
B)$630 F 
C)$618 F 
D)$630 U

Quizplus · Accepted Answer

SH = 1,900 units F1F1F1S1F1F1F10 0.2 hours per unit = 380 hours
Labor efficiency variance = (AH - SH)SR
= (410 hours - 380 hours)$21.00 per hour
= (30 hours)$21.00 per hour = $630 U

Bonnot Corporation Makes a Product That Has the Following Direct