Beakins Corporation produces a single product.The standard cost card for the product follows: During a recent period the company produced 1,200 units of product.Various costs associated with the production of these units are given below: The company records all variances at the earliest possible point in time.Variable manufacturing overhead costs are applied to products on the basis of standard direct labor-hours. The labor efficiency variance for the period is:

Question

Beakins Corporation produces a single product.The standard cost card for the product follows:  During a recent period the company produced 1,200 units of product.Various costs associated with the production of these units are given below:  The company records all variances at the earliest possible point in time.Variable manufacturing overhead costs are applied to products on the basis of standard direct labor-hours. The labor efficiency variance for the period is:

Quizplus · Accepted Answer

SH = 1,200 units × 1.5 hours per unit = 1,800 hours
Labor efficiency variance = (AH - SH)× SR
= (2,100 hours - 1,800 hours)× $10.00 per hour
= (300 hours)× $10.00 per hour
= $3,000 U

Beakins Corporation Produces a Single Product