# Computing the Direct Labor Efficiency and Rate Variance

Can you help me get started with this assignment?

Company manufactures only one product x. The company uses a standard cost system and has established the following standards per unit of product x:

Standard Quantity Standard Price Standard Cost

Direct Materials 3.0 lbs. $12 per lb. $36.00

Direct Labor 1.2 hrs. $15 per hr. $18.00

During the month of May, the following activity was recorded:

1. The company produced 6,000 units

2. A total of 21,000 lbs. of material was used at a cost of $241,500.

3. Each of 40 persons employed to produce the product x, worked an average of 160 hours at a rate of $16 per hour.

Required:

For direct labor employed in the production of X, compute the direct labor rate variance and the direct labor efficiency variance.

https://brainmass.com/business/labour-management-and-relations/computing-direct-labor-efficiency-rate-variance-376209

#### Solution Summary

Provides steps necessary to computer the direct labor efficiency variance and the direct labor rate variance.