The standard labour cost for 1 component is $15.00 (5 hours at $3 per hour). Last month, 6,000 hours were worked at a cost of $17,000 to produce 1,100 components.

The standard labour cost for 1 component is $15.00 (5 hours at $3 per hour). Last month, 6,000 hours were worked at a cost of $17,000 to produce 1,100 components.

The labour efficiency variance was:
A . $1,500 Adverse
B . $1,000 Adverse
C . $1,000 Favourable
D . $1,500 Favourable

Answer: A