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Direct Labor Variances The following data relate to labor cost for production of 4,300 cellular telephones: 2,930 hrs. at $15.50 2,880 hrs. at $15.80 Actual: Standard: a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Rate variance Time variance Total direct labor cost variance $ $ Favorable Unfavorable Favorable b. The employees may have been less-experienced or poorly trained, thereby resulting in a lower labor rate than planned. The lower level of experience or training may have resulted in less ✓ efficient performance. Thus, the actual time required was more than standard.

Direct Labor Variances The following data relate to labor cost for production of 4,300 cellular telephones: 2,930 hrs. at $15.50 2,880 hrs. at $15.80 Actual: Standard: a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Rate variance Time variance Total direct labor cost variance $ $ Favorable Unfavorable Favorable b. The employees may have been less-experienced or poorly trained, thereby resulting in a lower labor rate than planned. The lower level of experience or training may have resulted in less ✓ efficient performance. Thus, the actual time required was more than standard.

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter10: Standard Costing And Variance Analysis
Section: Chapter Questions
Problem 39BEB: Variable Overhead Spending and Efficiency Variances, Columnar and Formula Approaches Aretha Company...
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Direct Labor Variances The following data relate to labor cost for production of 4,300 cellular telephones: 2,930 hrs. at $15.50 2,880 hrs. at $15.80 Actual: Standard: a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Rate variance Time variance Total direct labor cost variance Feedback Favorable Unfavorable b. The employees may have been less-experienced or poorly trained, thereby resulting in a lower level of experience or training may have resulted in less than standard. Consider factors affecting labor performance. Favorable labor rate than planned. The lower efficient performance. Thus, the actual time required was more Check My Work Unfavorable variances can be thought of as increasing costs (a debit). Favorable variances can be thought of as decreasing costs (a credit). The labor cost variance is the difference between the actual and standard labor cost.
Transcribed Image Text:Direct Labor Variances The following data relate to labor cost for production of 4,300 cellular telephones: 2,930 hrs. at $15.50 2,880 hrs. at $15.80 Actual: Standard: a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Rate variance Time variance Total direct labor cost variance Feedback Favorable Unfavorable b. The employees may have been less-experienced or poorly trained, thereby resulting in a lower level of experience or training may have resulted in less than standard. Consider factors affecting labor performance. Favorable labor rate than planned. The lower efficient performance. Thus, the actual time required was more Check My Work Unfavorable variances can be thought of as increasing costs (a debit). Favorable variances can be thought of as decreasing costs (a credit). The labor cost variance is the difference between the actual and standard labor cost.
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