Labor Mix and Yield Variances: Piece O' Rock Insurance Company compares actual results with a flexible budget. The standard direct labor rates used in the flexible budget are established each year at the time the annual plan is formulated and held constant for the entire year. The standard direct labor rates in effect for the current fiscal year and the standard hours allowed for the actual output of insurance claims for the month of April in a claims department are shown in the schedule below:

The wage rates for each labor class increased under the terms of a new contract. The standard wage rates were not revised to reflect the new contract. The actual direct labor-hours worked and the actual direct labor rates per hour experienced for the month of April were as follows:\

Required:

Calculate the dollar amount of the total direct labor variance for the month of April for Piece O' Rock Insurance Company and break down the total variance into the following components:

a. Direct labor price and efficiency variances.

b. Direct labor mix and yield variances.

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Standard Direct Standard Direct Labor-Hours Labor Rate Allowed for Labor class III Labor class II Labor class I per Hour $8 Output 875 500 500 500