At a recent seminar you attended, the invited speaker was discussing some of the advantages and disadvantages of standard costs in terms of evaluating performance and motivating goal$-$congruent behavior on the part of employees. One criticism of standard costs in particular caught your attention: The use of conventional standard costs may not provide appropriate incentives for improvements needed to compete effectively with world$-$class organizations. The speaker then discussed so$-$called continuous$-$improvement standard costs. Such standards embody systematically lower costs over time. For example, on a monthly basis, it might be appropriate to budget a $1\mathrm{.}0\%$ reduction in per$-$unit direct labor cost.

Assume that the standard wage rate into the foreseeable future is $$26$ per hour. Assume, too, that the budgeted labor$-$hour standard for October of the current year is $3\mathrm{.}10$ hours and that this standard is reduced each month by $1\%.$ During December of the current year the company produced $6,400$ units of XL$-10,$ using $23,000$ direct labor hours. The actual wage rate per hour in December was $$28\mathrm{.}00.$

Required:

Prepare a table that contains the standard labor$-$hour requirement per unit and standard direct labor cost per unit for the $4$ months, October through January.

Compute the direct labor efficiency variance for December. Was this variance favorable or unfavorable?

Complete this question by entering your answers in the tabs below.

Required $2$

Prepare a table that contains the standard labor$-$hour requirement per unit and standard direct labor cost per unit for the $4$ months, October through January. $($Do not round intermediate calculations. Round your "Standard Direct Labor Cost$/$Unit$"$ answers to $2$ decimal places and "Standard Labor$-$Hour Requirement$/$Unit$"$ answers to $5$ decimal places.$)$

$\backslash$table$[[$Month$,\backslash$table$[[$Standard Labor$-$Hour$],[$Requirement$/$Unit$]],\backslash$table$[[$Standard$],[$Direct Labor$],[$Cost$/$Unit$]]],[$October$,,$hour per unit,$],[$November$,,$hour per unit,$],[$December$,,$hour per unit,$],[$January$,,$hour per unit,$]]$