Cost Management: A Strategic Emphasis 7th Edition by Edward Blocher,David Stout ,Paul Juras,Gary Cokins

Exercise 14

Mom's Apple Pie Company uses a standard cost system. The standard direct labor time for each pie is 10 minutes. During the most recent month, the company produced and sold 6,000 pies. The standard direct labor rate is $8 per hour; the actual labor rate per hour for the month was $8.40. The company used a total of 980 labor hours. What was the direct labor efficiency (usage) variance for the month (Show calculations.)