80.2K

Verified Solution

Link Copied!

Exercise 08-16 Computing and interpreting labor variances LO P3 Javonte Co. set standards of 3 hours of direct labor per unit of product and $16.60 per hour for the labor rate During October, the company uses 21,000 hours of direct laborat a $352,800 total cost to produce 7.200 units of product. In November, the company uses 25,000 hours of direct labor at a $421,250 total cost to produce 7,600 units of product. AHActual Hours SH - Standard Hours AR-Actual Rate SR - Standard Rate (1) Compute the direct labor rate variance, the direct labor efficiency variance, and the total direct labor cost variance for each of these two months. Classify each variance as favorable or unfavorable. (2) Javonte investigates variances of more than 5% of actual direct labor cost. Which direct labor variances will the company investigate further? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the direct labor rate variance, the direct labor efficiency variance, and the total direct labor cost variance for each of these two months. Classify each variance as favorable or unfavorable. (Indicate the effect of each variance by selecting for favorable, unfavorable, and no variance.) October Actul cont Standard Cosi November Actual Cost Standard Cost November Actual Cost Standard Cos! two months. Classify each variance as favorable or unfavorable. (2) Javonte investigates variances of more than 5% of actual direct labor cost. Which direct labor variances will the company investigate further? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Javonte investigates variances of more than 5% of actual direct labor cost. Which direct labor variances will the company Investigate further Which direct labor variances will the company investigate further

Answer & Explanation Solved by verified expert

See Answer