he following data relate to labor cost for production of 5,100 cellular telephones: ctual: 3,430 hrs. at $12.70 tandard: 3,380 hrs. at $13.00 Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorab nd an unfavorable variance as a positive number. ate variance 1,266 X Favorable

Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter9: Evaluating Variances From Standard Costs
Section: Chapter Questions
Problem 8E: Direct labor variances The following data relate to labor cost for production of 20,000 cellular...
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The following data relate to labor cost for production of 5,100 cellular telephones:
Actual: 3,430 hrs. at $12.70
Standard: 3,380 hrs. at $13.00
a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign
and an unfavorable variance as a positive number.
1,266 X
910 X
-368 X
Rate variance
Favorable
Unfavorable
✓
Time variance
Total direct labor cost variance
Favorable •✓
b. The employees may have been less-experienced or poorly trained, thereby resulting in a lower
may have resulted in less ✔efficient performance. Thus, the actual time required was more
✓
✔labor rate than planned. The lower level of experience or training
✔than standard.
Transcribed Image Text:The following data relate to labor cost for production of 5,100 cellular telephones: Actual: 3,430 hrs. at $12.70 Standard: 3,380 hrs. at $13.00 a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. 1,266 X 910 X -368 X Rate variance Favorable Unfavorable ✓ Time variance Total direct labor cost variance Favorable •✓ b. The employees may have been less-experienced or poorly trained, thereby resulting in a lower may have resulted in less ✔efficient performance. Thus, the actual time required was more ✓ ✔labor rate than planned. The lower level of experience or training ✔than standard.
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