50.1K

Verified Solution

Link Copied!

SkyChefs, Inc., prepares in-flight meals for a number of majorairlines. One of the company’s products is grilled salmon in dillsauce with baby new potatoes and spring vegetables. During the mostrecent week, the company prepared 4,800 of these meals using 1,400direct labor-hours. The company paid these direct labor workers atotal of $18,200 for this work, or $13.00 per hour.

According to the standard cost card for this meal, it shouldrequire 0.30 direct labor-hours at a cost of $12.50 per hour.

   
Required:

1. According to the standards, what direct labor cost shouldhave been incurred to prepare 4,800 meals? How much does thisdiffer from the actual direct labor cost? (Roundlabor-hours per meal and labor cost per hour to 2 decimalplaces.)

Number of mealsprepared
Standard direct labor-hoursper meal
Total direct labor-hoursallowed
Standard direct labor costper hour
Total standard direct laborcost
Actual cost incurred
Total standard direct laborcost
Total direct labor variance

2. Break down the difference computed in (1) above into a laborrate variance and a labor efficiency variance. (Indicatethe effect of each variance by selecting \"F\" for favorable, \"U\" forunfavorable, and \"None\" for no effect (i.e., zerovariance).)

Labor rate variance
Labor efficiencyvariance