Question

At Roger, the standard quantity of labor is 25 hours per
refrigeration unit. The standard wage rate is $36. In July, the
company produced 83 refrigeration units and incurred 2,100 labor
hours at a cost of $65,100.

Calculate the labor rate variance and the labor efficiency
variance. Indicate whether the variances are favorable or
unfavorable. *(Round intermediate calculations to 2
decimal places, e.g. 14.37 and final answers to 0 decimal places,
e.g. 125. Enter all variances as a positive
number.)*

Labor Rate Variance $___________ Unfavorable, Neither Unfavorable nor Favorable, Favorable?

Labor Efficiency Variance $_________ Unfavorable, Neither Unfavorable nor Favorable, Favorable?

Answer #1

direct labor rate variance = (Actual rate - standard rate) * actual hours.

here,

actual rate = $65,100 cost / 2100 hours

=>$31.

standard rate = $36.

actual hours = 2100

direct labor rate variance = ($31 - $36)*2100

=>$10,500 Favorable.

direct labor efficiency variance

(actual hours - standard hours) *standard rate

here,

actual hours = 2100 hours

standard hours = 83 units *25 hours

=>2,075 hours

standard rate = $36.

=> (2100 - 2075)*$36

=>$900 unfavorable.

At Lawn, the standard quantity of labor is 26 hours per
refrigeration unit. The standard wage rate is $35. In July, the
company produced 77 refrigeration units and incurred 2,070 labor
hours at a cost of $62,100.
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variance. Indicate whether the variances are favorable or
unfavorable. (Round intermediate calculations to 2 decimal places,
e.g. 14.37 and final answers to 0 decimal places, e.g. 125. Enter
all variances as a positive number.)...

Lewis Company’s standard labor cost of producing one unit of
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(a)
Compute the total labor variance.
Total labor variance
$
Favorable Neither favorable nor
unfavorable Unfavorable
(b)
Compute the labor price and quantity variances.
Labor price variance
$
Neither favorable nor
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Labor quantity variance
$
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Mordica Company’s standard labor cost per unit of output is
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Compute the total, price, and quantity labor variances.
(Round answers to 2 decimal places, e.g.
52.75.)
Total labor variance
$enter a dollar amount
rounded to 2 decimal places
select an option
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Bramble Company’s standard labor cost per unit of output is
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(Round answers to 2 decimal places, e.g.
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select an option
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(b) Is the rate variance favorable or unfavorable?
(c) Compute the efficiency variance
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(f) Is the...

If overhead is applied to production using direct labor hours
and the direct labor efficiency variance is favorable, then the
variable overhead efficiency variance is:
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unfavorable
either favorable or unfavorable.
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Compute the total, price, and quantity labor variances.
(Round answers to 2 decimal places, e.g.
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select an option
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The records of Norton, Inc. show the following for July.
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Standard variable overhead rate per standard direct
labor-hour
$
31
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60,000
Actual direct labor-hours worked
98,000
Actual total direct labor
$
2,178,000
Direct labor efficiency variance
$
41,000
U
Actual variable overhead
$
2,840,000
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32
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$
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$
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U
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