Landram Corporation Makes a Product with the Following Standard Costs

question 170

Multiple Choice

Landram Corporation makes a product with the following standard costs: In March the company produced 4,700 units using 10,230 kilos of the direct material and 2,210 direct labor-hours. During the month, the company purchased 10,800 kilos of the direct material at a cost of $76,680. The actual direct labor cost was $38,233 and the actual variable overhead cost was $11,934.

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 March is:

• A)$2,660 F
• B)$2,422 F
• C)$2,422 U
• D)$2,660 U

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Definitions:

Annual

Relating to a period of one calendar year, used to measure or describe events, reports, or statistics that occur or are accumulated yearly.

Bank Account

An account held at a financial institution that allows for the deposit and withdrawal of money.

Annual Withdrawals

The amount of money that an individual withdraws from an investment or savings account each year.

Interest

The charge for borrowing money or the return earned on an investment, typically expressed as a percentage.