Answer:
1. 2,040 Hours
2. $27,540
3. 460 U
4.Labor rate variance = 1,000 U
, Labor efficiency variance = 540 F
Explanation:
1. Standard labor hour allowed = (5,100 * 0.40) = 2,040 Hours
2. Standard labor cost = (2,040 * $13.50) = $27,540
3. Labor spending variance = (Standard cost - actual cost)
Labor spending variance = (27,540 - 28,000)
Labor spending variance = 460 U
4. Labor rate variance = (Standard rate - Actual rate) * Actual hours
Labor rate variance = ($13.50 - $14) * 2000
Labor rate variance = 0.50 * 2,000 U
Labor rate variance = 1,000 U
Labor efficiency variance = (Standard hour - Actual hour) * Standard rate
Labor efficiency variance= (2,040 - 2,000) * $13.50
Labor efficiency variance = 40 * 13.50 F
Labor efficiency variance = 540 F
