Answer the following questions using the information below:
Apple Valley Orchards, Inc. (AVO), developed standard costs for direct material and direct labor. In 2011, AVO estimated the following standard costs for one of their most well loved products, the AVO classic Grandma's large apple pie which had a brown sugar coating on the top of the crust as well as including cranberry and mince ingredients in addition to the apples.
During September, AVO produced and sold 1,200 pies using 1,875 pounds of direct materials at an average cost per pound of $7.00 and 280 direct labor hours at an average wage of $14.25 per hour.
-September's direct labor flexible-budget variance is:
A)$210.00 favorable
B)$210.00 unfavorable
C)$280.00 favorable
D)$280.00 unfavorable.

Question

Answer the following questions using the information below:
Apple Valley Orchards, Inc. (AVO), developed standard costs for direct material and direct labor. In 2011, AVO estimated the following standard costs for one of their most well loved products, the AVO classic Grandma's large apple pie which had a brown sugar coating on the top of the crust as well as including cranberry and mince ingredients in addition to the apples.
  During September, AVO produced and sold 1,200 pies using 1,875 pounds of direct materials at an average cost per pound of $7.00 and 280 direct labor hours at an average wage of $14.25 per hour.
-September's direct labor flexible-budget variance is:
A)$210.00 favorable 
B)$210.00 unfavorable 
C)$280.00 favorable 
D)$280.00 unfavorable.

Quizplus · Accepted Answer

The direct labor flexible-budget variance is calculated as the difference between the actual direct labor cost and the flexible-budget direct labor cost. The actual direct labor cost is $1,290, and the flexible-budget direct labor cost is $1,500. Therefore, the direct labor flexible-budget variance is $1,290 - $1,500 = -$210.00 unfavorable.

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