The standard direct labor cost for producing one unit of product is 5 direct labor hours ata standard rate of pay of $16. Last month, 15,000 units were produced and 73,500 directlabor hours were actually worked at a total cost of $1,080,000. The direct laborefficiency variance was

Answer: 24,000 (Favorable)

Explanation:

Given that,

Standard direct labor cost for producing one unit of product (A) = 5

Direct labor hours at a standard rate of pay (B) = $16

Units produced in last month (C) = 15,000

Direct labor hours (D) = 73,500

Total cost = $1,080,000

Direct labor efficiency variance = B * (C * A - D)

= 16 * (15,000 * 5 - 73,500)

= 24,000 (Favorable)