The following information relates to labour costs for the past month:
|
Budget |
Labour rate |
£10 per hour |
|
Production time |
15 000 hours |
|
|
Time per unit |
3 hours |
|
|
Production units |
5000 units |
|
|
Actual |
Wages paid |
£176 000 |
|
Production |
5500 units |
|
|
Total hours worked |
14 000 hours |
There was no idle time.
What were the labour rate and efficiency variances?
|
Rate variance |
Efficiency variance |
|
|
A |
£26 000 adverse |
£25 000 favourable |
|
B |
£26 000 adverse |
£10 000 favourable |
|
C |
£36 000 adverse |
£2500 favourable |
|
D |
£36 000 adverse |
£25 000 favourable |