Question
After evaluating Null Companys manufacturing process, management decides to establish standards of 2 hours of direct labor per unit of product and $15.50 per hour
After evaluating Null Companys manufacturing process, management decides to establish standards of 2 hours of direct labor per unit of product and $15.50 per hour for the labor rate. During October, the company uses 11,500 hours of direct labor at a $180,550 total cost to produce 6,100 units of product. In November, the company uses 22,500 hours of direct labor at a $355,500 total cost to produce 6,500 units of product. (1) Compute the direct labor rate variance, the direct labor efficiency variance, and the total direct labor cost variance for each of these two months.
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