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After evaluating Null Company’s manufacturing process,management decides to establish standards of 3 hours of directlabor per unit of product and $15 per hour for the labor rate.During October, the company uses 16,250 hours of direct labor at a$247,000 total cost to produce 5,600 units of product. In November,the company uses 22,000 hours of direct labor at a $335,500 totalcost to produce 6,000 units of product.1.Compute the direct labor rate variance, the direct laborefficiency variance, and the total direct labor cost variance foreach of these two months.2.Interpret the October direct labor variances.
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