Question - A company makes table lamps, for which the following standards have been developed:
Standard Inputs Expected for Each Unit of Output
Direct materials 20 kilograms
Direct labour 6 hours
Standard Price Expected per Unit of Output
Direct materials $2 per kilogram
Direct labour $8 per hour
During January, production of 100 lamps was expected, but 110 lamps were actually completed.
Direct materials purchased and used were 2,100 kilograms at an actual price of $ 2.20 per kilogram.
Direct labour cost for the month was $ 5,310, and the actual pay per hour was $ 9.00.
The direct-labour efficiency variance for the month of January is
a) $ 70 favourable
b) $ 560 favourable.
c) $ 560 unfavourable
d) $ 630 favourable
e) $ 630 unfavourable
The direct-material price variance for January is
a) $ 20 favourable
b) $ 420 unfavourable.
c) $ 420 favourable.
d) $ 400 unfavourable.
e) $ 400 favourable