Company E makes a product that has the following direct labor standards:
Standard direct labor
hours = 0.2 hours per unit
Standard direct labor rate = $15 per hour
In January the company’s budgeted production was 3,400 units but the actual output was 3,500 units. The company used 640 direct labor hours and the direct labor cost was $8,960.
What is the labor efficiency variance?
What is the labor rate variance?