Williams Corporation reports the following direct labor information for November: Standard rate $ 31.00 per hour Actual rate paid $ 31.90 per hour Standard hours allowed for actual production 44,300 hours Labor efficiency variance $ 198,400 F Required: Based on these data, what was the number of actual hours worked and what was the labor price variance? (Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.)
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Problem 16-62 (Algo) Solve for Direct Labor-Hours (LO 16-5)
Williams Corporation reports the following direct labor information for November:
| Standard rate | $ | 31.00 | per hour |
| Actual rate paid | $ | 31.90 | per hour |
| Standard hours allowed for actual production | 44,300 | hours | |
| Labor efficiency variance | $ | 198,400 | F |
Required:
Based on these data, what was the number of actual hours worked and what was the labor price variance? (Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.)
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