Kranberry Networks Ltd had implemented a standard costing system to aid it in assessing the performanceof its operations. In the first quarter of the current year, the company had the following variances:Direct materials price varianceDirect materials quantity varianceDirect labour rate varianceDirect labour efficiency variance£1,200 favourable£ 324 unfavourable£3,375 favourable£ 90 unfavourableThe following additional information is provided for the first quarter:Actual quantity of raw materials used per unitActual cost of raw material per kgActual time taken to manufacture one unitActual wage rate per hourActual cost of direct material purchased and usedActual direct wages paid4.00 kg£ 7.003.00 hours£ 8.25£42,000£37,125The company hired a new supervisor in the beginning of the second quarter. Based on the supervisor'sinputs, the company replaced faulty machines. The company has reskilled its labour workforce to bring inefficiency in its production process.The company's cost records for the second quarter of the year are given below:Actual quantity of raw materials used per unitActual cost of raw material per kgActual time taken to manufacture one unitActual wage rate per hourActual cost of direct material purchased and usedActual direct wages paid3.50 kg6.502.50 hours8.50£ 34,125£ 31,875Required:1. Determine the following standards based on the variances and actual values provided for the firstquarter. (d) Direct labour efficiency varianceDirect labour efficiency varianceFavourable

Name: Kranberry Networks Ltd had implemented a standard costing system to a
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Description: Kranberry Networks Ltd had implemented a standard costing system to aid it in assessing the performanceof its operations. In the first quarter of the current year, the company had the following variances:Direct materials price varianceDirect materia

Standard costing is the costing in which actual price/quantity is compared with the standard set.

Business

Accounting

Kranberry Networks Ltd had implemented a standard cost of its operations. In the first quarter of the current year, the Direct materials price variance Direct materials quantity variance Direct labour rate variance Direct labour efficiency variance £1 £ £3 £ The following additional information is provided for the first Actual quantity of raw materials used per unit material per ka Actual coet

Kranberry Networks Ltd had implemented a standard cost of its operations. In the first quarter of the current year, the Direct materials price variance Direct materials quantity variance Direct labour rate variance Direct labour efficiency variance £1 £ £3 £ The following additional information is provided for the first Actual quantity of raw materials used per unit material per ka Actual coet

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter8: Standard Costs And Variances

Section: Chapter Questions

Problem 27Q: Identify several causes of a favorable labor efficiency variance.

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Similar questions

Identify several causes of a favorable labor efficiency variance.
What is the direct labor time variance?
What is the direct labor rate variance?
Identify several causes of a favorable labor rate variance.
What is the significance of a production-volume variance?
The variable overhead efficiency variance is caused by the difference between which of the following? A. actual and budgeted units B. actual and standard allocation base C. actual and standard overhead rates D. actual units and actual overhead rates
The variable overhead rate variance is caused by the sum between which of the following? A. actual and standard allocation base B. actual and standard overhead rates C. actual and budgeted units D. actual units and actual overhead rates
When is the direct labor time variance favorable? A. when the actual quantity used is greater than the standard quantity B. when the actual quantity used is less than the standard quantity C. when the actual price paid is greater than the standard price D. when the actual price is less than the standard price
When is the labor rate variance favorable? A. when the actual quantity used is greater than the standard quantity B. when the actual quantity used is less than the standard quantity C. when the actual price paid is greater than the standard price D. when the actual price is less than the standard price
What are some possible reasons for a material price variance? A. substandard material B. labor rate increases C. labor rate decreases D. labor efficiency
When is the labor rate variance unfavorable? A. when the actual quantity used is greater than the standard quantity B. when the actual quantity used is less than the standard quantity C. when the actual price paid is greater than the standard price D. when the actual price is less than the standard price
What are some possible causes of a direct labor time variance?