Ask Question
15 September, 01:06

Denver Co. recently used 14,000 labor hours to produce 7,500 units. According to manufacturing specifications, each unit is anticipated to take two hours to complete. The company's actual payroll costs were $158,200. If the standard labor cost per hour is $11, Denver's labor efficiency variance is: Question 18 options: $11,300 (U). $11,000 (U). $11,000 (F). $11,300 (F).

+4
Answers (1)
  1. 15 September, 03:15
    0
    Direct labor time (efficiency) variance = $11,000 favorable

    Explanation:

    Giving the following information:

    Denver Co. recently used 14,000 labor hours to produce 7,500 units. According to manufacturing specifications, each unit is anticipated to take two hours to complete. The standard labor cost per hour is $11.

    To calculate the direct labor efficiency variance, we need to use the following formula:

    Direct labor time (efficiency) variance = (Standard Quantity - Actual Quantity) * standard rate

    Direct labor time (efficiency) variance = (2*7,500 - 14,000) * 11

    Direct labor time (efficiency) variance = $11,000 favorable
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Denver Co. recently used 14,000 labor hours to produce 7,500 units. According to manufacturing specifications, each unit is anticipated to ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers