Question 15 (5 points) Optimum Co. uses a standard costing system in its Ruston Plant in which all inventory is carried at standard. The following standard costs data is provided for one of its products: Direct Materials 5 pounds @ $2.25 per pound Direct Labor 3 hours @ $9.00 per hour Optimum planned to produce 32,000 units each month. For April, the operating data show that 31,500 units of product were produced. During April, 160,000 pounds of materials were purchased at a price of $2.20 per pound. 159,000 pounds of material and 94,500 direct labor hours were used in production Thinking about Optimum Co. (use data above). In analyzing the labor efficiency variance for April, which of the following is definitely true? Workers took exactly the time expected to complete production. Workers were less experienced than standards anticipated, as indicated by the unfavorable materials efficiency variance. Workers were less experienced than standards anticipated, as indicated by the favorable labor rate variance. Workers were more experienced than standards anticipated, as indicated by the unfavorable labor rate variance. Previous Page Next Page Page 15 of 15