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Exercise 21-16(Algo) Computing and analyzing direct labor variances LO P3 Javon Company set...

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Accounting

Exercise 21-16(Algo) Computing and analyzing direct labor variances LO P3
Javon Company set standards of 2 hours of direct labor per unit at a rate of $15.50 per hour. During October, the company actually
uses 11,500 hours of direct labor at a $180,550 total cost to produce 6,100 units. In November, the company uses 15,500 hours of
direct labor at a $244,125 total cost to produce 6,500 units of product.
AH= Actual 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 variance for each of these two
months.
(2) Javon 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.
Compute the direct labor rate variance, the direct labor efficiency variance, and the total direct labor variance for each of these two months. (Indicate the
effect of each variance by selecting favorable, unfavorable, or no variance.)
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