Landram Corporation Makes a Product with the Following Standard Costs

question 136

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 rate variance for March is:

• A)$3,757 U
• B)$3,757 F
• C)$3,995 U
• D)$3,995 F