Kartman Corporation Makes a Product with the Following Standard Costs

question 238

Multiple Choice

Kartman Corporation makes a product with the following standard costs: In June the company's budgeted production was 3,400 units but the actual production was 3,500 units. The company used 22,150 pounds of the direct material and 2,290 direct labor-hours to produce this output. During the month, the company purchased 25,400 pounds of the direct material at a cost of $170,180. The actual direct labor cost was $57,021 and the actual variable overhead cost was $8,931.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 June is:

• A) $4,560 Favorable
• B) $4,560 Unfavorable
• C) $4,731 Unfavorable
• D) $4,731 Favorable

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