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Accounting

Gentile Corporation makes a product with the following standard costs:

The company produced 6,000 units in May using 36,970 kilos of direct material and 4,340 direct labor-hours. During the month, the company purchased 40,400 kilos of the direct material at $4.70 per kilo. The actual direct labor rate was $13.70 per hour and the actual variable overhead rate was $2.70 per hour.

The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.

The labor efficiency variance for May is:

A. $6302 U
B. $6440 U
C. $6,440 F
D. $6,302 F

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M952246

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