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Refreshers Limited specialises in making fresh juices by hand with organic fruits. The company has developed the following standard costs: Standard quantity or Standard hours
Refreshers Limited specialises in making fresh juices by hand with organic fruits. The company has developed the following standard costs: Standard quantity or Standard hours price or rate Direct material 1.3 kg $6.00 per litre Direct labour 0.6 hours $19.00 per hour Variable overhead 0.6 hours $3.00 per hour During April, Refreshers Limited made 4,100 bottles of fresh juice and used 5,380 kg of direct material and 2,730 direct labor-hours. In total, 6,000 kg of direct material was purchased during the month at $5.80 per kg. The actual direct labor rate was $19.80 per hour and the actual variable overhead rate was $2.90 per hour. Variable overhead is applied based on direct labor-hours. Compute the following: A) Labour efficiency variance B) Labour rate variance C) Variable overhead rate variance D) Variable overhead efficiency variance
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