Refer to the data in Problem 9-18. Limpio, Inc., also uses two different types of direct labor in producing the cleansing chemical: mixing and drum-filling labor (the completed product is placed into 50-gallon drums). For each batch of 20,000 gallons of direct materials input, the following standards have been developed for direct labor:

The actual direct labor hours used for the output produced in March are also provided:

Labor Type Mix
Mixing ......18,000 hrs.
Drum-filling .....12,000
Total ........30,000 hrs.
Yield .......158,400 gallons
Required:
1. Compute the direct labor mix and yield variances.
2. Compute the total direct labor efficiency variance. Show that the total direct labor efficiency variance is equal to the sum of the direct labor mix and yieldvariances.

Transcribed Image Text:

Direct Labor Type Mis SP Standard Cost Mixing Drum-filling 2,000 hrs. 1,000 3,000 hrs $11.00 $22,000 8.008,000 $30,000 Totals Yield 15,000 gallons