Welch Company Budgeted the Following Cost Standards for the Current

question 84

Multiple Choice

Welch Company budgeted the following cost standards for the current year: Direct materials = 1.40 kilograms per unit @ $1.50 per kilogram
Direct labour = 0.75 hours per unit @ $6 per hour
Actual production and costs were as follows:
Units produced = 2,800
Direct materials used = 4,500 kg.
Direct materials purchased = 5,000 kg. @ a cost of $5,850
Direct labour incurred = 2,000 hours at a cost of $13,000
The labour efficiency variance was:

• A)$600 F
• B)$400 U
• C)$4,800 F
• D)$1,000 U