5. The auto repair shop of Quality Motor Company uses standards to control the l

Question

5. 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:

6.

Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below:

Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below:

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: Job Motor tune-up Standard Hours Standard Rate Standard Cost 2.20 $5.50 $12.10 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 $517 F $495 U Required: 1. Determine the number of actual labor-hours spent on tune-ups during the week. Actual labor hours hours

Explanation / Answer

Ans. 5:

Labour spending variance=SR(SH-AH)

=-495=5.5( 130*2.2-AH)

=-495=1573-AH

=AH=2068 Hours

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