Lewis Company's standard labor cost of producing one unit of Product DD is 3.60 hours at the rate of $14 per hour. During August, 43,900 hours of labor are incurred at a cost of $14.20 per hour to produce 12,100 units of Product DD. 1. Compute the total labor variance. 2. Compute the labor price and quantity variances. 3. Compute the labor price and quantity variances, assuming the standard is 4 hours of direct labor at $14.40 per hour.

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter8: Standard Costs And Variances
Section: Chapter Questions
Problem 9PB: Ribcos labor cost information for making its only product for March is as follows: A. What is the...
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Lewis Company's standard labor cost of producing one unit of
Product DD is 3.60 hours at the rate of $14 per hour. During
August, 43,900 hours of labor are incurred at a cost of $14.20
per hour to produce 12,100 units of Product DD.
1. Compute the total labor variance.
2. Compute the labor price and quantity variances.
3. Compute the labor price and quantity variances, assuming the
standard is 4 hours of direct labor at $14.40 per hour.
Transcribed Image Text:Lewis Company's standard labor cost of producing one unit of Product DD is 3.60 hours at the rate of $14 per hour. During August, 43,900 hours of labor are incurred at a cost of $14.20 per hour to produce 12,100 units of Product DD. 1. Compute the total labor variance. 2. Compute the labor price and quantity variances. 3. Compute the labor price and quantity variances, assuming the standard is 4 hours of direct labor at $14.40 per hour.
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