Aldrin Manufacturing uses a standard cost system with the following labor standards for one unit of product: • • Standard hours per unit = 0.25 Standard wage rate = $9.00 During March, Aldrin incurred 4,120 hours of direct labor and was paid $37,980 in wages for the production of 15,800 units. Calculate the direct labor rate variance and direct labor efficiency variance and indicate whether the variances are favorable or unfavorable.

Aldrin Manufacturing uses a standard cost system with the following labor standards for one unit of product: • • Standard hours per unit = 0.25 Standard wage rate = $9.00 During March, Aldrin incurred 4,120 hours of direct labor and was paid $37,980 in wages for the production of 15,800 units. Calculate the direct labor rate variance and direct labor efficiency variance and indicate whether the variances are favorable or unfavorable.

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 58E: At the beginning of the year, Lopez Company had the following standard cost sheet for one of its...

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Eagle Inc. uses a standard cost system. During the most recent period, the company manufactured 115,000 units. The standard cost sheet indicates that the standard direct labor cost per unit is $1.50. The performance report for the period includes an unfavorable direct labor rate variance of $3,700 and a favorable direct labor time variance of $10,275. What was the total actual cost of direct labor incurred during the period?
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Case made 24,500 units during June, using 32,000 direct labor hours. They expected to use 31,450 hours per the standard cost card. Their employees were paid $15.75 per hour for the month of June. The standard cost card uses $15.50 as the standard hourly rate. A. Compute the direct labor rate and time variances for the month of June, and also calculate the total direct labor variance. B. If the standard rate per hour was $16.00, what would change?
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