Under normal conditions, Sarah pays her employees $8.50 per hour, and it will take 2.8 hours of labor per pair of shoes. During August, Sole Purpose Shoe Company incurred actual direct labor costs of $66,066 for 7,260 hours of direct labor in the production of 2,200 pairs of shoes.
Get the direct labor variance.
Labor rate variance =Actual hours(Standard rate - Actual rate) | ||
Labor efficiency variance =Standard Rate(Actual Hours - Standard Hours) | ||
Direct labor variance =(Standard rate*Standard hours) - (Actual Rate*Actual hours) | ||
Standard Rate per hour =$8.50 per hour | ||
Standard Hours =2.80 hours*3,500 =9,800 hours | ||
Actual Rate per hour =$8.90 per hour | ||
Actual hours worked =9,450 hours | ||
Labor rate variance =9,450 hours*($8.50 - $8.90) =$3,780(U) | ||
Labor efficiency variance =$8.50*(9,450 - 9,800) =$2,975(F) | ||
Direct labor variance =($8.50*9,800) - ($8.90*9,450) =$805(U) |
Under normal conditions, Sarah pays her employees $8.50 per hour, and it will take 2.8 hours...
Under normal conditions, Sarah pays her employees $8.50 per hour, and it will take 2.8 hours of labor per pair of shoes. During August, Sole Purpose Shoe Company incurred actual direct labor costs of $65,148 for 7,320 hours of direct labor in the production of 2,300 pairs of shoes. Complete the following table, showing the direct labor variance relationships for August for Sole Purpose Shoe Company. If required, round your answers to two decimal places. When entering variances, use a...
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Your next-door neighbor recently began a new job as assistant controller for Conundrum Corporation. As her first assignment, she prepared a performance report for January. She was scheduled to present the report to management the next morning, so she brought it home to review. As the two of you chatted in the backyard, she decided to show you the report she had prepared. Unfortunately, your dog thought the report was an object to be fetched. The pup made a flying...
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