A work center consisting of 3 machines operates 40 hours a week. In a 4-weekperiod, it actually worked 355 hours and produced 475 standard hours of work.Calculate the utilization and efficiency of the work center. What is the demonstratedweekly capacity of the work center?
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
A work center consisting of 3 machines operates 40 hours a week. In a 4-week
period, it actually worked 355 hours and produced 475 standard hours of work.
Calculate the utilization and efficiency of the work center. What is the demonstrated
weekly capacity of the work center?
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