Chapter 11, Problem 11.14SE

Record standard costing transactions (Learning Objective 7)

During the week, the Spartan Restaurant Group’s French fry manufacturing facility incurred 1,500 hours of direct labor. Direct laborers were paid $12.20 per hour. The standard hourly labor rate is $11.80. Standards indicate that for the volume of output actually achieved, the factory should have used 2,200 hours.

Requirements

1. 1. Record the labor transactions using a standard cost accounting system.
2. 2. Are the variances favorable or unfavorable? Explain.