A popular product of Loring Glassworks is a hand-decorated vase. The company's standard cost system calls for 1.25 hours of direct labor per vase, at a standard wage rate of $14. During Septem- ber, Loring produced 5,000 vases at an actual direct labor cost of $82,500 for 7,500 direct labor hours. What is the actual wage rate per hour? Compute the labor rate and efficiency variances for the month. Was paying workers the actual wage rather than the standard wage an effective strategy for Loring?

A popular product of Loring Glassworks is a hand-decorated vase. The company's standard cost system calls for 1.25 hours of direct labor per vase, at a standard wage rate of $14. During Septem- ber, Loring produced 5,000 vases at an actual direct labor cost of $82,500 for 7,500 direct labor hours. What is the actual wage rate per hour? Compute the labor rate and efficiency variances for the month. Was paying workers the actual wage rather than the standard wage an effective strategy for Loring?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter8: Standard Costs And Variances

Section: Chapter Questions

Problem 9EA: Penny Company manufactures only one product and uses a standard cost system. The following...

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