Variable Cost Variances
The records of Simon Company show the following for February:
|
Standard labor hours allowed per unit of output |
1.5 |
|
Standard variable overhead rate per |
|
|
standard direct labor hour |
$30 |
|
Good units produced |
60,000 |
|
Actual direct labor hours worked |
92,000 |
|
Actual total direct labor |
$1,975,000 |
|
Direct labor efficiency variance |
$40,000 U |
|
Actual variable overhead |
$2,560,000 |
Required
Compute the direct labor and variable overhead price and efficiency variances.