Answer:
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual hours
Explanation:
Giving the following information:
The production used 2.5 labor hours per finished unit, and the company paid $21 per hour, totaling $52.50 per unit of finished product.
<u>We weren't provided with enough information to solve the problem. We need estimated production hours and rates. But, I can leave the formula to solve it.</u>
To calculate direct labor rate variance, we need to use the following formula:
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Hours
Answer:
Net Income for the year is $41700
Explanation:
The accounting basis that is generally followed by the businesses is the accrual basis of accounting. The accrual principle states that incomes and expenses should be recorded and recognized in the period to which they relate to rather than in the period where cash is received or paid.
This means that we will record income and expenses related to this year in this year's profit calculation even when we have not received or paid cash for such incomes and expenses.
Thus, net income for this year will be calculated as,
Net Income = Total Sales Revenue - Total expenses
Net income = 113000 - 71300
Net Income = $41700
Answer:
Explanation:
a. The computation of the labor rate variance is shown below:
= Actual Hours × (Actual rate - standard rate)
= 5,050 × ($16.80 per hour - $16 per hour)
= 5,050 × $0.80 per hour
= $4,040 unfavorable
b. The computation of the labor time variance is shown below:
= Standard Rate × (Actual hours - Standard hours)
= $16 per hour × (5,050 hours - 1,000 × 5.4 hours)
= $16 per hour × -350 hours
= -$5,600 favorable
c. The computation of the total labor variance is shown below:
= (Actual hours × Actual rate) - (Standard hours × standard rate)
= (5,050 hours × $16.80 per hour) - (1,000 bicycles × 5.4 hours × $16 per hour)
= $84,840 - $86,400
= -$1,560 favorable
