Computing labor variances LO₃ Mike Murphy Doors manufactures garage doors for homes. The standard quantity of direct labor to manufacture a door is 4.5 hours. The standard hourly wage in this department is $12.50 per hour. During August, 6,100 doors were produced. The payroll records indicate that 31,1 10 hours were worked at a total cost for payroll of $405,985.50.

Calculate the following using the diagram format shown in Figure 7- 1 to compute variances:

1.Labor rate variance.
2. Labor efficiency variance.
3. Net labor variance.