SkyChefs, Incorporated, prepares in-flight meals for a number of major airlines. One of the company's products is grilled salmon with mixed vegetables. During the most recent week, the company prepared 4,800 of these meals using 2,350 direct labor-hours. The company paid its direct labor workers a total of $23,500 for this work, or $10.00 per hour. According to the standard cost card for this meal, it should require 0.50 direct labor-hour at a cost of $9.40 per hour. Required: 1. What is the standard labor-hours allowed (SH) to prepare 4,800 meals? 2. What is the standard labor cost allowed (SH x SR) to prepare 4,800 meals? 3. What is the labor spending variance? 4. What are the labor rate variance and the labor efficiency variance? Note: For requirements 3 and 4, indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. 1. Standard labor-hours allowed 2. Standard labor cost allowed 3. Labor spending variance 4. Labor rate variance 4. Labor efficiency variance
SkyChefs, Incorporated, prepares in-flight meals for a number of major airlines. One of the company's products is grilled salmon with mixed vegetables. During the most recent week, the company prepared 4,800 of these meals using 2,350 direct labor-hours. The company paid its direct labor workers a total of $23,500 for this work, or $10.00 per hour. According to the standard cost card for this meal, it should require 0.50 direct labor-hour at a cost of $9.40 per hour. Required: 1. What is the standard labor-hours allowed (SH) to prepare 4,800 meals? 2. What is the standard labor cost allowed (SH x SR) to prepare 4,800 meals? 3. What is the labor spending variance? 4. What are the labor rate variance and the labor efficiency variance? Note: For requirements 3 and 4, indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. 1. Standard labor-hours allowed 2. Standard labor cost allowed 3. Labor spending variance 4. Labor rate variance 4. Labor efficiency variance
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
None
![Exercise 10-2 (Algo) Direct Labor Variances [LO10-2]
Saved
SkyChefs, Incorporated, prepares in-flight meals for a number of major airlines. One of the company's products is grilled salmon
with mixed vegetables. During the most recent week, the company prepared 4,800 of these meals using 2,350 direct labor-hours.
The company paid its direct labor workers a total of $23,500 for this work, or $10.00 per hour.
According to the standard cost card for this meal, it should require 0.50 direct labor-hour at a cost of $9.40 per hour.
Required:
1. What is the standard labor-hours allowed (SH) to prepare 4,800 meals?
2. What is the standard labor cost allowed (SH × SR) to prepare 4,800 meals?
3. What is the labor spending variance?
4. What are the labor rate variance and the labor efficiency variance?
Note: For requirements 3 and 4, indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and
"None" for no effect (i.e., zero variance). Input all amounts as positive values.
1. Standard labor-hours allowed
2. Standard labor cost allowed
3. Labor spending variance
4. Labor rate variance
4. Labor efficiency variance](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8d3d8deb-8b5d-4bc6-b1e1-562032e8da26%2F68d85eb8-dbf0-4c0e-bfa4-c561c8910b41%2F22xnysg_processed.png&w=3840&q=75)
Transcribed Image Text:Exercise 10-2 (Algo) Direct Labor Variances [LO10-2]
Saved
SkyChefs, Incorporated, prepares in-flight meals for a number of major airlines. One of the company's products is grilled salmon
with mixed vegetables. During the most recent week, the company prepared 4,800 of these meals using 2,350 direct labor-hours.
The company paid its direct labor workers a total of $23,500 for this work, or $10.00 per hour.
According to the standard cost card for this meal, it should require 0.50 direct labor-hour at a cost of $9.40 per hour.
Required:
1. What is the standard labor-hours allowed (SH) to prepare 4,800 meals?
2. What is the standard labor cost allowed (SH × SR) to prepare 4,800 meals?
3. What is the labor spending variance?
4. What are the labor rate variance and the labor efficiency variance?
Note: For requirements 3 and 4, indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and
"None" for no effect (i.e., zero variance). Input all amounts as positive values.
1. Standard labor-hours allowed
2. Standard labor cost allowed
3. Labor spending variance
4. Labor rate variance
4. Labor efficiency variance
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step 1: Introduction
VIEWStep 2: Working note #1:- Calculation of standard labor hours allowed
VIEWStep 3: Working note #2:- Calculation of standard labor cost allowed
VIEWStep 4: Working Note #3:- Labor spending variance
VIEWStep 5: Working Note #4:- Calculation of labor rate and efficiency variance :
VIEWSolution
VIEW
Step by step
Solved in 6 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education