Question

Heavy​ Products, Inc. developed standard costs for direct material and direct labor. In​ 2017, AII estimated the following standard costs for one of their major​ products, the 10−gallon plastic container. Budgeted quantity Budgeted price Direct materials 0.7 pounds $90 per pound Direct labor 0.05 hours $20 per hour During​ June, Heavy Products produced and sold 24,000 containers using 1,500 pounds of direct materials at an average cost per pound of $92 and 1,200 direct manufacturing labor−hours at an average wage of $91.25 per hour. The direct manufacturing labor efficiency variance during June is​ ________.

Answer 1

Direct labor time (efficiency) variance= 0

Step-by-step explanation:

Giving the following information:

Standard:

Direct labor 0.05 hours $20 per hour

Actual:

Heavy Products produced and sold 24,000 containers using 1,200 direct manufacturing labor−hours.

To calculate the direct labor efficiency variance, we need to use the following formula:

Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate

Direct labor time (efficiency) variance= (0.05*24,000 - 1,200)*20

Direct labor time (efficiency) variance= 0