Tractor Corporation produces toy tractors. The company uses thefollowing direct cost categories:
| Category | Standard Inputs
for 1 output | Std. Cost
per input |
| Direct Materials | 4.00 | $12.50 |
| Direct Labour | 1.40 | 9.50 |
| Direct Marketing | 0.54 | 5.50 |
Actual performance and budgeted performance for the company isshown below:
Actual output: (in units) 5,000
Direct Materials:
| Materials costs | $299,000 |
| Input purchased and used | 23,000 |
| Actual price per input | $13.00 |
Direct Manufacturing Labour:
| Labour costs | $ 95,000 |
| Labour-hours of input | 9,500 |
| Actual price per hour | $10.00 |
Direct Marketing Labour:
| Labour costs | $ 40,000 |
| Labour-hours of input | 5,000 |
| Actual price per hour | $ 8.00 |
Question: What are the efficiency variances for directmanufacturing labour and directmarketing labour,respectively?
| | a) $23,750 unfavourable; $12,650 favourable |
| | b) $38,375 unfavourable; $7,350 favourable |
| | c) $23,750 unfavourable; $12,650 unfavourable |
| | d) $23,750 favourable; $12,650 unfavourable |
| | e) $25,898 unfavourable; $15,133 unfavourable |
