volue 66.66 points SkyChefs, Inc., prepares in-flight meals for a number of majo

Question

volue 66.66 points SkyChefs, Inc., prepares in-flight meals for a number of major airlines, One of the company's products is griled company prepared 3,500 of these labor workers a total of $23,940 for this work, or $14.00 per hour salmon in dill auce with baby new potatoes and spring vegetables. During the most recent week, the According to the standard cost card for this meal, it should require 0.50 direct labor-hours at a cost of $13.50 per hour. Required: 1. According to the standards, what direct labor cost should have been incurred to prepare 3,500 meals? How much does this ditter from the actual direct labor cost? (Round labor-hours per meal and labor cost per hour to 2 decimal places.) Number of meals prepared Standard direct labor-hours per meal Total direct labor-hours allowed Standard direct labor cost per hour Total standard direct labor cost Actual cost incurred Total standard direct labor cost Total direct labor variance 2 Break down the difference computed in 41) above into a labor rate variance and a iabor efficiency variance (Indicate the effect of each variance by selecting r for favorabto,u for unfavora and "None for no effect (i.e., zero variance). ble Labor rate variance

Explanation / Answer

Number of meals prepared 3500 Standard direct labor-hours per meal 0.5 Total direct labor-hours allowed 1750 Standard direct labor cost per hour 13.5 Total standard direct labor cost 23625 Actual cost incurred . 23940 Total standard direct labor cost 23625 Total direct labor variance . 315 Unfavorable 2 Labor rate variance=23940-(1710*13.5)= 855 Unfavorable Labor efficiency variance=13.5*(1710-1750)= 540 Favorable

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