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i Safari File Edit View History Bookmarks Window Help ?62% E. Tue 2:42 PM Q?E dy Guided Solutions and Study Help 201870-Second Summer 2018-A Chapter 10 Homework Question 5 (of 5) Save & Exit Submit Screen Shot 2018-07.1.43 PM velue: 20.00 points The auto repair shop of Quality Motor Company uses standards to control the labor time and labor cost in the shop. The standard labor cost for a motor tune-up is given below: Screen Shot 2018-07...1.55 PM Job Motor tune up Standard Hours Standard Rate Standard Cost 2.20 $5.50 S12.10 Screen Shot 2018-07...2.08 PM The record showing the time spent in the shop last week on motor tune-ups has been misplaced. However the shop supervisor recalls that 130 tune-ups were completed during the week, and the controller recalls the following variance data relating to tune-ups: Labor rate variance Labor spending variance S 47 F $965 U Screen Shot 2018-07.. .2.23 PM Required: 1. Determine the number of actual labor-hours spent on tune-ups during the week. labor hours hours Screen Shot 2018-07...2.35 PM 2. Determine the actual hourly rate of pay for tune-ups last week. (Round your answer to 2 decimal places.) rate per hour 31

Explanation / Answer

1 Actual labor hours: 470 hours Standard hours allowed for actual output = 130 x 2.20 = 286 hours Labor spending variance = (AH x AR) - (SH x SR) = 965 (AH x AR) = (SH x SR) + 965 = (286 x 5.50) + 965 = 2538 Labor rate variance = (AH x AR) - (AH x SR) = -47 (AH x AR) = (AH x SR) - 47 = (AH x 5.50) - 47 2538 = 5.50 AH - 47 AH = (2538 + 47)/5.50 = 470 2 Actual hourly rate: $5.40 per hour (AH x AR) = 2538 470 AR = 2538 AR = 2538/470 = 5.40

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