To determine the labor efficiency variance for the given product, we need to follow a systematic procedure using the provided data. Let's break it down step-by-step:
### Step 1: Calculate the Standard Hours Allowed for Actual Output
The standard labor hours per unit of output is given as 83 hours. The actual output produced in the last month is 900 units. To find the standard hours allowed, we multiply the standard labor hours per unit by the actual output:
[tex]\[
\text{Standard Hours Allowed} = \text{Standard Labor-Hours per Unit} \times \text{Actual Output Units}
\][/tex]
[tex]\[
\text{Standard Hours Allowed} = 83 \, \text{hours/unit} \times 900 \, \text{units} = 74,700 \, \text{hours}
\][/tex]
### Step 2: Calculate the Labor Efficiency Variance
The actual hours worked during the month are given as 6,100 hours. The standard labor rate is \[tex]$12.10 per hour. To find the labor efficiency variance, use the following formula:
\[
\text{Labor Efficiency Variance} = (\text{Standard Hours Allowed} - \text{Actual Hours Worked}) \times \text{Standard Labor Rate}
\]
Substitute the known values into the formula:
\[
\text{Labor Efficiency Variance} = (74,700 \, \text{hours} - 6,100 \, \text{hours}) \times \$[/tex]12.10/\text{hour}
\]
[tex]\[
\text{Labor Efficiency Variance} = 68,600 \, \text{hours} \times \$12.10/\text{hour} = \$830,060
\][/tex]
### Step 3: Determine the Sign (Favorable or Unfavorable)
A positive value for the labor efficiency variance indicates a favorable variance (F), because fewer actual hours were worked than the standard hours allowed. Conversely, a negative value would indicate an unfavorable variance (U). In this case, the calculation resulted in a positive variance.
### Final Result
The labor efficiency variance for the month is \[tex]$830,060 Favorable (F).
Thus, the correct answer is:
None of the options provided (A, B, C, or D) match this answer exactly. The calculated labor efficiency variance is \$[/tex]830,060 F.
