Puvo, Inc., manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard cost system and has established the following standards for one unit of product Standard Price or Standard Standard Quantity Direct materials 5.8 pounds Rate $0.60 per pound Direct labor 0.5 hours: $33.50 per hour Cost $ 3.48 $16.75 Variable manufacturing overhead 0.5 hours $8.50 per hour $ 4.25 During March, the following activity was recorded by the company The company produced 2.400 units during the month A total of 19.400 pounds of material were purchased at a cost of $13,580. There was no beginning inventory of materials on hand to start the month; at the end of the month, 3,620 pounds of material remained in the warehouse. During March, 1,090 direct labor-hours were worked at a rate of $30.50 per hour. Variable manufacturing overhead costs during March totaled $14,061 The direct materials purchases variance is computed when the materials are purchased. The labor efficiency variance for March is: Multiple Choice $3,040 U $3,685 U $3.685 F $3,040 F