Ceramics Etc. is a manufacturer of large flower pots for urban settings. The company has these standards.

$($Click the icon to view the standards.$)$

Read the requirements.

Requirement $1.$ Compute the direct labor rate variance and the direct labor efficiency variance. $($Enter the variances as positive numbe amounts to the nearest whole dollar. Label the variance as favorable $($F$)$ or unfavorable $($U$).$ Abbreviations used: DL $=$ Direct labor$)$

Requirements

Compute the direct labor rate variance and the direct labor efficiency variance.

What is the total variance for direct labor?

Who is generally responsible for each variance?

Interpret the variances.

Begin with the direct labor rate variance. First determine the formula for the rate variance, then compute the rate variance for dirf

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Standard Price and Volume

$\backslash$table$[[\backslash$table$[[$Direct materials $($resin$)...........................12$ pounds per pot at a cost of $$6\mathrm{.}00$ per$],[$pound$]]],[\backslash$table$[[...........30$ hours per pot at a cost of $$1500$ per$],[$hour$]]],[$Standard variable manufacturing overhead rate $......$ $$8\mathrm{.}00$ per direct labor hour$],[$Budgeted fixed manufacturing overhead $...........$ $$42,900$