SkyChefs, Inc., prepares meals for the flights of several major airlines. A product of the...
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SkyChefs, Inc., prepares meals for the flights of several major airlines. A product of the company is grilled salmon in dill sauce with chamomile potatoes and spring vegetables. In the last week, the company prepared 4,000 meals of this dish with 960 hours of direct labor. The company paid the workers a total of $ 9600, that is, $ 10 per hour. According to the standard cost sheet for this plate, 0.25 hours of direct labor must be used at a cost of $ 9.75 per hour.
Question 1a. Determine the cost that must have been incurred to manufacture 4,000 plates (total standard cost).
Question 1b. Determine how much higher or lower the total standard cost is than the actual cost incurred (total variation).
Question 2. Break down the total variation in labor between the variation in the labor rate and the variation in the efficiency of the labor force.
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