Got Guitars Inc. manufactures electric guitars, The following data relate to the

Question

Got Guitars Inc. manufactures electric guitars, The following data relate to the standards for direct labor We Got Guitars Inc. had the following actual results for March Actual direct labor hours 526,000 What is the direct labor efficiency variance for March? A) $312 favorable C) $12,188 favorable BSS12 unfavorable D) $12,188 unfavorable 24) An unfavorable variance causes operating income to be the budgeted operating income? A) greater than B) equal to C) lower than D) half as much as 25) The varlance "measures whether the quantity of direct labor used to make the actual number of outputs is within the standard allowed for that number of outputs. A) direct Llabor rate C) direct labor production volume B) direct labor efficiency D) direct labor overhead flexible budget 26) CSC Inc. manufactures tables. Each table requires 50 direct labor hours in its production. CSC Inc. has a direct labor rate of $13 per direct labor hour. The production budget shows that CSC Inc. plans to produce 600 tables in March and 1,100 tables in April What is the total combined direct labor cost that CSC Inc should budget in March and April? A) 22,100 ?) 14,300 C) 3900 D)11.50 27) Graham Manufacturing designs and manufactures sinks for home and commercial applications Graham Manafacturing recorded the following data for its commercial sink production line during the month of March: 36 530 Standard overhead cost per unit Actual overhead costs Actual DL hours 21,375 28 $7.50 Actual overhead cost per machine hour Actual sinks What is the variable manufacturing overhead efficiency variance in March? A) $27,900 favorable B)$4275 unfavorable D) $4275 favorable C) $27,900 unfavorable C-6

Explanation / Answer

23 Direct labor efficiency variance = 25*(1200-375*4.5)= $12188 Favorable 24 An unfavorable variance causes operating income to be lower than the budgeted operating income 25 The direct labor efficiency variance measures whether the quantity of direct labor used to make is wothin standards 26 Total combined direct labor cost = 0.5*13*(600+1100)= $11050 27 Variable manufacturing overhead efficiency variance = 6*(2850-1500*5)= $27900 favorable

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