1 | Standard Labor Hours Allowed | $7,640 | |
2 | Standard Labor Cost Allowed | $47,368 | |
3 | Labor Spending Variance | $3,140 | U |
4 | Labor Rate Variance | $828 | F |
Labor Efficiency Variance | $3,968 | U | |
5 | Variable Overhead Rate Variance | $4,140 | U |
Variable Overhead Efficiency Vaticance | $2,752 | U |
Explanation;
1.
Number of Units Manufactured (a) | $19,100 |
Standard Labor Time Per Unit ( 24 Minutes ÷ 60 Minutes Per Hour) | .40 |
Standard Labor Hours Allowed (a)× (b) | $7,640 |
2.
Standard Labor Hours Allowed (a) | $7,640 |
Standard Direct Labor Rate Per Hour (b) | 6.20 |
Standard Labor Cost Allowed (a)× (b) | $47,368 |
3.
Actual Direct Labor Cost (a) | $50,508 | |
Standard Labor Cost Allowed (b) | $47,368 | |
Labor Spending Variance (a)×(b) | $3,140 | U |
4.
Actual Hours of Input , at the Actual Rate (AH×AR) | Actual Hours of Input at the Standard Rate (AH×SR) | Standard Hours Allowed for out put at the standard Rate(SH×SR) |
8,280 Hours× $6.20 Per Hour | 7,640 Hour × $6.20 Per Hour) | |
$50,508 | $51,336 | $47,368 |
Labor Rate Variance =$50,508 -$51,336 = $828 F
Labor Efficiency Variance =$51,336-$47,368=$3,968 U
Spending Variance =$828F -$3,968 U =$3,140U
Actual Hours of Input at the Actual Rate (AH×AR) | Actual Hours of Input at the Standard Rate(AH×SR) | Standard Hours Allowed of Output at the Standard Rate (SH×SR) |
8,280 Hours×$4.30 Per Hours | 7,640 Hours× $4.30 Per Hours | |
$39,744 | $35,604 | $32,852 |
Variance Overhead Rate Variance = $39,744-$35,604 = $4,140 U
Variable Overhead Efficiency Variance = $35,604 -$32,852 = $2,752 U
Spending Variance = $4,140 - $2,752 =$1,388 U
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