Asked by Claire Fledderman on Jul 16, 2024
Verified
The labor efficiency variance for the month is closest to:
A) $3,255 F
B) $3,255 U
C) $3,495 U
D) $3,495 F
Labor Efficiency Variance
The variance between the real hours spent working and the anticipated standard hours, times the normal wage rate.
- Scrutinize and expound on labor efficiency discrepancies.
Verified Answer
VE
vanessa elizondoJul 22, 2024
Final Answer :
A
Explanation :
SH = 8,800 units × 0.20 hours per unit = 1,760 hours
Labor efficiency variance = (AH × SR)- (SH × SR)
= (AH - SH)× SR
= (1,610 hours - 1,760 hours)× $21.70 per hour
= (-150 hours)× $21.70 per hour
= $3,255 F
Reference: CH09-Ref62
Saxena Corporation makes a product that has the following direct labor standards:
The company budgeted for production of 2,900 units in July, but actual production was 2,800 units.The company used 250 direct labor-hours to produce this output.The actual direct labor rate was $14.10 per hour.
Labor efficiency variance = (AH × SR)- (SH × SR)
= (AH - SH)× SR
= (1,610 hours - 1,760 hours)× $21.70 per hour
= (-150 hours)× $21.70 per hour
= $3,255 F
Reference: CH09-Ref62
Saxena Corporation makes a product that has the following direct labor standards:
The company budgeted for production of 2,900 units in July, but actual production was 2,800 units.The company used 250 direct labor-hours to produce this output.The actual direct labor rate was $14.10 per hour.
Learning Objectives
- Scrutinize and expound on labor efficiency discrepancies.