The auto body repair shop of Quality Motor Company uses standards to control the labor...
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Accounting
The auto body repair shop of Quality Motor Company uses standards to control the labor time and labor cost in the shop. The standard labor cost for a motor tune-up is given below:
Standard Hours
Standard Rate
Standard Cost
Motor Tune-Up
2.5
$25.00
$62.50
The record showing the time spent in the shop last week on motor tune-ups has been misplaced. However, the shop supervisor recalls that 50 tune-ups were completed during the week, and the controller recalls the following variance data relating to tune-ups:
Labor Rate Variance
$150 F
Labor Spending Variance
$200 U
Required:
1. Determine the number of actual labor-hours spent on tune-ups during the week.
2. Determine the actual hourly rate of pay for tune-ups last week.
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