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Cox Engineering performs cement core tests in its laboratory. The following standards have been set...

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Accounting

Cox Engineering performs cement core tests in its laboratory. The following standards have been set for each core test performed:

Standard Hours or Quantity Standard Price or Rate
Direct materials 3.0 pounds 0.75 per pound
Direct labour 0.4 hours 12.00 per hour
Variable manufacturing overhead 0.4 hours 9.00 per hour

During March, the laboratory performed 2,000 core tests. On March 1 no direct materials (sand) were on hand. Variable manufacturing overhead is assigned to core tests on the basis of direct labour hours. The following events occurred during March: 8,600 pounds of sand were purchased at a cost of 7,310. 7,200 pounds of sand were used for core tests. 840 actual direct labour hours were worked at a cost of 8,610. Actual variable manufacturing overhead incurred was 3,200. The labour rate variance for March is:Multiple Choice

  • 1,470 unfavourable.

  • 1,470 favourable.

  • 4,578 unfavourable.

  • 4,578 favourable.

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