a.  How many temporary employees should the manager hire for December? employees b.  If each temporary employee earns a standard $19 per hour, what would be the labor time variance if the actual number of additional letters sorted in December was 31,716,000? Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. $

Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter23: Evaluating Variances From Standard Costs
Section: Chapter Questions
Problem 3MAD: United States Postal Service: Mail sorting time variance One of the operations in the United States...
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Direct Labor Standards for Nonmanufacturing Operations

One of the operations in the Wonderland Post Office is a mechanical mail sorting operation. In this operation, letter mail is sorted at a rate of one letter per second. The letter is mechanically sorted from a three-digit code input by an operator sitting at a keyboard. The manager of the mechanical sorting operation wants to determine the number of temporary employees to hire for December. The manager estimates that there will be an additional 30,798,000 pieces of mail in December, due to the upcoming holiday season.

Assume that the sorting operators are temporary employees. The union contract requires that temporary employees be hired for one month at a time. Each temporary employee is hired to work 145 hours in the month.

a.  How many temporary employees should the manager hire for December?
employees

b.  If each temporary employee earns a standard $19 per hour, what would be the labor time variance if the actual number of additional letters sorted in December was 31,716,000? Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
$  

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