Answered: Hamlin Corp. produces ceramic…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter8: Standard Costs And Variances

Section: Chapter Questions

Problem 7PB: Marymount Company makes one product. In the month of April, it made 3,500 units. Workers were paid...

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Question

Hamlin Corp. produces ceramic figurines. It takes 2.5 hours of direct labor to produce a single figurine. Hamlin's standard labor cost is $18 per hour. During September, Hamlin produced 12,600 units and used 32,500 hours of direct labor at a total cost of $568,750. What is Hamlin's labor efficiency variance for September?

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

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