Linis Company produces a commercial cleaning compund known as Zide. The direct materials and direct labor standards for one unit of Zide are as follows:                                       Standard Qty       Standard price      Sandard cost Direct materials            4.6 lbs                    P2.50/lb.                P11.50 Direct labor                    0.2 hr.                    P35/hr.                     7.00 During the most recent month, the following activity was recorde: Twenty thousand pounds of material were purchased at a cost of P2.35 per pound. All of the materials, purchased was usedd to produce 4,000 units of Zide. 750 hours of direct labor time were recorded at a total labor cost of P30,375. Compute for the direct labor efficiency variance. Indicate whether favorable or unfavorable.

FINANCIAL ACCOUNTING
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Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Linis Company produces a commercial cleaning compund known as Zide. The direct materials and direct labor standards for one unit of Zide are as follows:

                                      Standard Qty       Standard price      Sandard cost

Direct materials            4.6 lbs                    P2.50/lb.                P11.50

Direct labor                    0.2 hr.                    P35/hr.                     7.00

During the most recent month, the following activity was recorde:

  1. Twenty thousand pounds of material were purchased at a cost of P2.35 per pound.
  2. All of the materials, purchased was usedd to produce 4,000 units of Zide.
  3. 750 hours of direct labor time were recorded at a total labor cost of P30,375.

Compute for the direct labor efficiency variance. Indicate whether favorable or unfavorable.             

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