Brookman, Inc. manufactures lead crystal glasses. The standard direct labor time

Question

Brookman, Inc. manufactures lead crystal glasses. The standard direct labor time is 0.4 hour per glass, at a cost of $18 per hour. The actual results for one month's production of 6,900 glasses were 0.2 hours per glass, at a cost of $11 per hour. Calculate the direct labor cost variance and the direct labor efficiency variance. Select the formula, then enter the amounts and compute the cost variance for direct labor and identify whether the variance is favorable (F) or unfavorable (U) -Direct Labor Cost Variance Select the formula, then enter the amounts and compute the efficiency variance for direct labor and identify whether the variance is favorable (F) or unfavorable (U) Direct Labor Efficiency Variance ) x

Explanation / Answer

Direct Labor Cost Variance = Standard Cost - Actual Cost

= 0.4 x 18 x 6900 - 6900 x 0.2 x 11

= 49680 - 15180

= 34500 Fav

Direct Labor Eff Variance = (standard hours - actual hours ) x standard rate

= (6900 x 0.40 - 6900 x 0.2) x 18

= 24840 Fav

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