Patterson Company
the Following Information Is for Patterson Company's July

question 196

Multiple Choice

Patterson Company
The following information is for Patterson Company's July production:
$\begin{array}{l}\text { Standards: }\\\begin{array}{ll}\text { Material } & 3.0 \text { feet per unit@ } \$ 4.20 \text { per foot } \\\text { Labor } & 2.5 \text { hours per unit@ } \$ 7.50 \text { per hour }\end{array}\end{array}$

$\begin{array}{l}\text { Actual: }\\\begin{array}{ll}\text { Production } & 2,750 \text { units produced during the month } \\\text { Material } & 8,700 \text { feet used; } 9,000 \text { feet purchased @ } \$ 4.50 \text { per foo } \\\text { Labor } & 7,000 \text { direct labor hours@ } \$ 7.90 \text { per hour }\end{array}\end{array}$

(Round all answers to the nearest dollar. )
Refer to Patterson Company.What is the labor efficiency variance?

• A)$1,875 U
• B)$ 938 U
• C)$1,875 F
• D)$1,125 U

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Definitions:

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Binding Decisions

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Arbitrators' Decisions

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