The fourth edition of Business Ethics: Decision Making for PersonalIntearity and Social Responsibility, by Hartman, DesJardins, and M accessible, and practicalLintrod focuses hensive, The text els and tion. In he real timely eads e on r on gen ata ert Paulson's Piano Service, Inc. is trying to establish the standard labor cost of tuning a typical piano. The following data have been collected from time and motion studies conducted over the past three months. Actual time spent on tuning a piano 1.25 hours Hourly wage rate Payroll taxes Setup and downtime Travel and rest periods $50 12% of wage rate 5% of actual labor time 15% of actual labor time Fringe benefits 20% of wage rate Instructions (a) (b) (c) (d) Determine the standard direct labor hour per each piano that is tuned. Determine the standard direct labor hourly rate. Determine the standard direct labor cost per each piano that is tuned. If it took 1.65 hours to tune a piano at the standard hourly rate, what was the direct labor quantity variance? (e) During the month of May, Paulson's Piano service tuned 80 pianos. The average time spent on each piano was 1.75 hours. The average cost per hour was $62.25 per hour. Paulson's had to hire some less experienced part time help in order to handle the demand. (1) (2) (3) (4) Calculate the direct labor price variance. Calculate the direct labor quantity variance. Calculate the total direct labor variance. Explain what might have caused the variances.
The fourth edition of Business Ethics: Decision Making for PersonalIntearity and Social Responsibility, by Hartman, DesJardins, and M accessible, and practicalLintrod focuses hensive, The text els and tion. In he real timely eads e on r on gen ata ert Paulson's Piano Service, Inc. is trying to establish the standard labor cost of tuning a typical piano. The following data have been collected from time and motion studies conducted over the past three months. Actual time spent on tuning a piano 1.25 hours Hourly wage rate Payroll taxes Setup and downtime Travel and rest periods $50 12% of wage rate 5% of actual labor time 15% of actual labor time Fringe benefits 20% of wage rate Instructions (a) (b) (c) (d) Determine the standard direct labor hour per each piano that is tuned. Determine the standard direct labor hourly rate. Determine the standard direct labor cost per each piano that is tuned. If it took 1.65 hours to tune a piano at the standard hourly rate, what was the direct labor quantity variance? (e) During the month of May, Paulson's Piano service tuned 80 pianos. The average time spent on each piano was 1.75 hours. The average cost per hour was $62.25 per hour. Paulson's had to hire some less experienced part time help in order to handle the demand. (1) (2) (3) (4) Calculate the direct labor price variance. Calculate the direct labor quantity variance. Calculate the total direct labor variance. Explain what might have caused the variances.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The fourth edition of Business Ethics: Decision Making for PersonalIntearity and
Social Responsibility, by Hartman, DesJardins, and M
accessible, and practicalLintrod
focuses
hensive,
The text
els and
tion. In
he real
timely
eads
e on
r on
gen
ata
ert
Paulson's Piano Service, Inc. is trying to establish the standard labor cost of tuning a typical piano. The
following data have been collected from time and motion studies conducted over the past three months.
Actual time spent on tuning a piano 1.25 hours
Hourly wage rate
Payroll taxes
Setup and downtime
Travel and rest periods
$50
12% of wage rate
5% of actual labor time
15% of actual labor time
Fringe benefits
20% of wage rate
Instructions
(a)
(b)
(c)
(d)
Determine the standard direct labor hour per each piano that is tuned.
Determine the standard direct labor hourly rate.
Determine the standard direct labor cost per each piano that is tuned.
If it took 1.65 hours to tune a piano at the standard hourly rate, what was the direct labor quantity
variance?
(e)
During the month of May, Paulson's Piano service tuned 80 pianos. The average time spent on each
piano was 1.75 hours. The average cost per hour was $62.25 per hour. Paulson's had to hire some
less experienced part time help in order to handle the demand.
(1)
(2)
(3)
(4)
Calculate the direct labor price variance.
Calculate the direct labor quantity variance.
Calculate the total direct labor variance.
Explain what might have caused the variances.
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