Answer:
Instructions are below.
Explanation:
Giving the following information:
The standard wage rate for oil change technicians is $ 17 per hour. standard of 18 minutes (or 0.30 hours) per oil change.
Production= 1,600 oil changes
Actual hours= 310 direct labor hours
the average rate= $ 24 per hour.
To calculate the direct labor rate and efficiency variance, we need to use the following formulas:
Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate
Direct labor time (efficiency) variance= (0.3*1,600 - 310)*17
Direct labor time (efficiency) variance= $2,890 favorable
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity
Direct labor rate variance= (17 - 24)*310
Direct labor rate variance= $2,170 unfavorable
