1. A standard cost (a) changes in direct proportion to changes in the level of activity, (b) is an amount incurred at the actual level of production for the period, or (c) is an amount incurred under normal conditions to provide a product or service.
2. What is a cost variance?
3. The following information is available for York Company.
|
Actual direct labor hours per unit |
25 hours |
|
Standard direct labor hours per unit |
20 hours |
|
Actual production (units) |
2,500 units |
|
Budgeted production (units) |
3,000 units |
|
Actual rate per hour |
$31.00 |
|
Standard rate per hour |
$3.00 |
The labor efficiency variance is (a) $3,750 U, (b) $3,750 F, or (c) $3,875 U.