Maison D’Orleans Department Store has two employees who wrap packages for customers. The standard time to wrap a package is five minutes. During November, the employees worked a total of 380 hours and wrapped 4,320 packages. The company’s standard hourly wage rate is $9.00 per hour, but these employees were actually paid $9.10 per hour.
Required:
(a) What are the standard hours allowed for the total packages wrapped?
(b) Compute the labor rate and efficiency variances.
(c) Provide some possible explanations for the variances.