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Posted: June 26th, 2024
Lee Maritime Company manufactures special metallic materials and decorative fittings for luxury
Lee Maritime Company manufactures special metallic materials and decorative fittings for luxury yachts that require highly skilled labor. Lee uses standard costs to prepare its flexible budget. For the first quarter of the year, direct materials and direct labor standards for one of their popular products were as follows: Direct materials: 3 pounds per unit; $4 per poundDirect labor: 5 hours per unit; $15 per hourLee produced 5,000 units during the quarter. At the end of the quarter, an examination of the labor costs records showed that the company used 30,000 direct labor hours and actual total direct labor costs were $378,000. What is the direct labor cost variance? (Round any intermediate calculations to the nearest cent, and your final answer to the nearest dollar.)A.$72,000 FavorableB. $375,000 FavorableC. $375,000 UnfavorableD. $72,000 Unfavorable
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