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Apple Valley Orchards, Inc. (AVO), developed standard costs for direct material and direct labor. In 2011, AVO estimated the following standard costs for one of
Apple Valley Orchards, Inc. (AVO), developed standard costs for direct material and direct labor. In 2011, AVO estimated the following standard costs for one of their most well loved products, the AVO classic Grandma's large apple pic which had a brown sugar coating on the top of the crust as well as including cranberry and mince ingredients in addition to the apples. Dirce materials Dincer lahar Budgeted quantity Budgeted price 15 pounds $7.25 per pound 0.25 hours $14.00 per hour During September, AVO produced and sold 1,200 pies using 1,875 pounds of direct materials at an average cost per pound of $7.00 and 280 direct labor hours at an average wage of $14.25 per hour. September's direct material Efficiency Variance is: A S468.00 favorable B) $468.00 unfavorable C) 5543.00 favorable Di S543.00 unfavorable
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