Bortello Corporation produces high-quality leather boots. The company has a standard cost system and has...
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Accounting
Bortello Corporation produces high-quality leather boots. The company has a standard cost system and has set the following standards for materials and labor:
| Leather (12 strips @ $20) | $240 |
| Direct labor (10 hours @ $12) | $120 |
| Total prime cost | $360 |
During the year Bortello produced 125 boots. Actual leather purchased was 1,700 strips, at $16 per strip. There were no beginning or ending inventories of leather. Actual direct labor was 1,500 hours at $15 per hour. Calculate the labor rate variance and the labor efficiency variance, respectively.
a.$4,500 F and $3,000 F
b.$4,500 U and $3,000 U
c.$4,500 F and $3,000 U
d.$4,500 U and $3,000 F
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