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26 November, 09:07

Flapjack Corporation had 7,680 actual direct labor hours at an actual rate of $12.45 per hour. Original production had been budgeted for 1,100 units, but only 960 units were actually produced. Labor standards were 7.2 hours per completed unit at a standard rate of $13.00 per hour. Round your answer to the nearest cent. The direct labor time variance is $4,208.64 unfavorable $4,208.64 favorable $9,984.00 unfavorable $9,984.00 favorable

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  1. 26 November, 09:14
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    Labour time (efficiency) variance = $9,984 unfavorable

    Explanation:

    The labour time variance is the dollar value of the difference between the standard time allowed for the actual output produced and the actual time used.

    Hours

    Standard hours (960 units * 7.2 hours) = 6,912

    Actual hours 7,680

    Time variance 768 Unfavorable

    * standard labour rate * $13

    Variance $9,984 Unfavorable
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