| + | M ezto.mheducation.com/hm.tpx-Exam 3 My Grades -(201509-MBAS01-ON 1DAccoun
ID: 2493771 • Letter: #
Question
| + | M ezto.mheducation.com/hm.tpx-Exam 3 My Grades -(201509-MBAS01-ON 1DAccounting Principles 54. Four Seasons Industries has established direct labor performance standards for its maintenance and repair shop. However, some of the labor records were destroyed during a recent fire. The actual hours worked during August were 2,500, and the total direct labor budget variance was $1,300 unfavorable. The standard labor rate was $16 per hour, but rocent resignations allowed the firm to hire lower-paid replacement workers for some jobs, and this produced a favorable rate variance of $3,500 for August Required: a. Calculate the actual direct labor rate paid per hour during August. (Do not round intermediate calculations and round your answer to 2 decimal places.) rate b. Calculate the dollar amount of the direct labor efficiency variance for August. (Indicate the effect of each variance by selecting F for favorable, "U" for unfavorablo.)Explanation / Answer
Labor rate variance = (Actual Rate-Standard Rate)*Actual Hour
-3500 = (Actual Rate - 16)*2500
Actual Rate = 16-3500/2500
Actual Rate = $ 14.60
Answer
Actual Rate = $ 14.60
b)
Total Labor Variance = 1300 Unfavorable
Labor Rate Variance = 3500 Favorable
Labor Efficiency Variance = Total Labor Variance - Labor Rate Variance
Labor Efficiency Variance = 1300 - (- 3500)
Labor Efficiency Variance = 4800
Labor Efficiency Variance = 4800 Unfavorable
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.