Determine the number of actual labour-hours spent opening batches during the week and determine the actual hourly rate paid to employees for opening batches last week.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Determine the number of actual labour-hours spent opening batches during the week and determine the actual hourly rate paid to employees for opening batches last week.

Worldwide Credit Card Inc. uses standards to control the labour time involved in opening mail from cardholders and recording the
enclosed remittances. Incoming mail is gathered into batches, and a standard time is set for opening and recording each batch.
The labour standards relating to one batch are as follows:
Per batch
Standard
Hours
2.5
Total labour variance
Labour rate variance
Standard
Rate
$12.00
The record showing the time spent last week in opening batches of mail has been misplaced. However, the batch supervisor
recalls that 168 batches were received and opened during the week, and the controller recalls the following variance data relating
to these batches:
$660 U
$300 F
Standard
Cost
$30.00
(Hint: A useful way to proceed is to work from known to unknown data, either by using the variance formulas or by using the
columnar format.)
Transcribed Image Text:Worldwide Credit Card Inc. uses standards to control the labour time involved in opening mail from cardholders and recording the enclosed remittances. Incoming mail is gathered into batches, and a standard time is set for opening and recording each batch. The labour standards relating to one batch are as follows: Per batch Standard Hours 2.5 Total labour variance Labour rate variance Standard Rate $12.00 The record showing the time spent last week in opening batches of mail has been misplaced. However, the batch supervisor recalls that 168 batches were received and opened during the week, and the controller recalls the following variance data relating to these batches: $660 U $300 F Standard Cost $30.00 (Hint: A useful way to proceed is to work from known to unknown data, either by using the variance formulas or by using the columnar format.)
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