Exercise 23-6 x Your answer is incorrect. Try again. Lewis Company\'s standard l
ID: 2516350 • Letter: E
Question
Exercise 23-6 x Your answer is incorrect. Try again. Lewis Company's standard labor cost of producing one unit of Product DD is 3.6 hours at the rate of $13.2 per hour. During August, 43,000 hours of labor are incurred at a cost of $13.30 per hour to produce 11,800 units of Product DD. (a) Compute the total labor variance. Total labor variance -5 m in ravorable (b) Compute the labor price and quantity variances. Labor price variance Labor quantity variance (c) Compute the labor price and quantity variances, assuming the standard is 3.9 hours of direct labor at $13.50 per hour. Labor price variance Labor quantity variance Click if you would like to Show Work for this question: Open Show WorkExplanation / Answer
Answer
Direct labor Hours
Rate per DLH
Cost
Direct labor [Actual]
43000
$13.3
$571,900
Direct labor [Standard]
42480
$13.2
$560,736
Total Labor variance = Standard Cost – Actual Cost = 560736 – 571900 = 11,164 Unfavourable
Labor Price Variance
(
Standard Rate
-
Actual Rate
)
x
Actual Labor Hours
(
$ 13.20
-
$ 13.30
)
x
43000
-4300
Variance
4300
Unfavourable-U
Labour Quantity Variance
(
Standard Hours
-
Actual Hours
)
x
Standard Rate
(
42480
-
43000
)
x
$ 13.20
-6864
Variance
6864
Unfavourable-U
Labor Rate Variance
(
Standard Rate
-
Actual Rate
)
x
Actual Labor Hours
(
$ 13.50
-
$ 13.30
)
x
43000
8600
Variance
8600
Favourable-F
Labour Efficiency Variance
(
Standard Hours [11800 x 3.9]
-
Actual Hours
)
x
Standard Rate
(
46020
-
43000
)
x
$ 13.50
40770
Variance
40770
Favourable-F
Direct labor Hours
Rate per DLH
Cost
Direct labor [Actual]
43000
$13.3
$571,900
Direct labor [Standard]
42480
$13.2
$560,736
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.