Reference no: EM132777213
Question - According to the standards that have been set for the robes, the factory should work 780 direct labor-hours each month and produce 1,950 robes.
At standard, each robe should require 2.8 yards of material. All of the materials purchased during the month were used in production.
Standard costs:
Direct Materials: Total $35,490; per unit of product: $18.20
Direct labor: Total $7,020; Per unit of product: $ 3.60
Variable Manufacturing Overhead (based on direct labor hours) Total: 2,340; Per Unit of product: $1.20
During Sep, the factory worked only 760 direct labor-hours and produced 2,000 robes. The following actual costs were recorded during the month:
Direct Materials (6,000 yards) Total: $36,000; Per unit of Product: $18.00
Direct Labor Total: $7,600; Per unit of Product: 3.80
Variable Manufacturing OH Total: $3,800; per unit of product: $1.90
Required - What would be the labor efficiency variance?