Figure 10-3. Bortello Corporation produces high-quality leather boots.The company has a standard cost system and has set the following standards for materials and labor:
During the year Bortello produced 125 boots.Actual leather purchased was 1,700 strips,at $16 per strip.There were no beginning or ending inventories of leather.Actual direct labor was 1,500 hours at $15 per hour.
Refer to Figure 10-3.Calculate the labor rate variance and the labor efficiency variance,respectively.
A)$4,500 U and $3,000 U
B)$4,500 F and $3,000 F
C)$4,500 U and $3,000 F
D)$4,500 F and $3,000 U

Question

Figure 10-3. Bortello Corporation produces high-quality leather boots.The company has a standard cost system and has set the following standards for materials and labor:
 During the year Bortello produced 125 boots.Actual leather purchased was 1,700 strips,at $16 per strip.There were no beginning or ending inventories of leather.Actual direct labor was 1,500 hours at $15 per hour.
Refer to Figure 10-3.Calculate the labor rate variance and the labor efficiency variance,respectively.
A)$4,500 U and $3,000 U 
B)$4,500 F and $3,000 F 
C)$4,500 U and $3,000 F 
D)$4,500 F and $3,000 U

Quizplus · Accepted Answer

The Answer of Figure 10-3. Bortello Corporation produces high-quality leather boots.The company has a standard cost system and has set the following standards for materials and labor:
 During the year Bortello produced 125 boots.Actual leather purchased was 1,700 strips,at $16 per strip.There were no beginning or ending inventories of leather.Actual direct labor was 1,500 hours at $15 per hour.
Refer to Figure 10-3.Calculate the labor rate variance and the labor efficiency variance,respectively.
A)$4,500 U and $3,000 U 
B)$4,500 F and $3,000 F 
C)$4,500 U and $3,000 F 
D)$4,500 F and $3,000 U