SkyInc provides in-flight meals for a number of major airlines. One of the company’s products is stuffed cannelloni with roasted pepper sauce, fresh baby corn, and spring salad. During the most recent week, the company made 6,000 of these meals, actually using 1,150 direct labour-hours. The company actually paid these direct labour workers a total of $11,500 for this work, or $10 per hour. According to the standard cost card for this meal, it should require 0.20 direct labour hours at a cost of $9.50 per hour. Required: 1. Break down the difference computed in (1) above into a labour rate variance and a labour efficiency variance. Part 1 AH x AR AH x SR SH x SR RATE VARIANCE EFFICIENCY VARIANCE TOTAL LABOUR VARIANCES
SkyInc provides in-flight meals for a number of major airlines. One of the company’s products is stuffed cannelloni with roasted pepper sauce, fresh baby corn, and spring salad. During the most recent week, the company made 6,000 of these meals, actually using 1,150 direct labour-hours. The company actually paid these direct labour workers a total of $11,500 for this work, or $10 per hour. According to the standard cost card for this meal, it should require 0.20 direct labour hours at a cost of $9.50 per hour. Required: 1. Break down the difference computed in (1) above into a labour rate variance and a labour efficiency variance. Part 1 AH x AR AH x SR SH x SR RATE VARIANCE EFFICIENCY VARIANCE TOTAL LABOUR VARIANCES
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter9: Evaluating Variances From Standard Costs
Section: Chapter Questions
Problem 10E: Ada Clothes Company produced 40,000 units during April. The Cutting Department used 12,800 direct...
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SkyInc provides in-flight meals for a number of major airlines. One of the company’s products is stuffed cannelloni with roasted pepper sauce, fresh baby corn, and spring salad. During the most recent week, the company made 6,000 of these meals, actually using 1,150 direct labour-hours. The company actually paid these direct labour workers a total of $11,500 for this work, or $10 per hour.
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According to the |
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Required: | ||||||||||||||||||||||||||
1. Break down the difference computed in (1) above into a labour rate variance and a labour efficiency variance. | ||||||||||||||||||||||||||
Part 1 | ||||||||||||||||||||||||||
AH | x | AH | x | SR | SH | x | SR | |||||||||||||||||||
RATE VARIANCE | EFFICIENCY VARIANCE | |||||||||||||||||||||||||
TOTAL LABOUR VARIANCES | ||||||||||||||||||||||||||
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