One of Bella Corporation's chief products is a line of high-quality exterior wooden doors for residential structures. A key step in the manufacturing process consists of applying a protective lacquer finish to the completed door. Established standards allow a laborer five minutes to apply the finish to each door. The labor assigned to this task has a standard wage rate of $24 per hour. During a recent eight-hour shift, 90 doors received the application of the protective finish at a total labor cost of $192.

Question

Quizplus · Accepted Answer

Bella experienced an unfavorable labor efficiency variance of $12 because the actual labor hours (90 doors x 5 minutes/door / 60 minutes/hour = 7.5 hours) exceeded the standard labor hours (90 doors x 5 minutes/door / 60 minutes/hour = 6 hours) by 1.5 hours. This 1.5-hour difference, multiplied by the standard labor rate of $24 per hour, results in an unfavorable labor efficiency variance of $12 (1.5 hours x $24 per hour = $12).

One of Bella Corporation's Chief Products Is a Line of High-Quality