Question
Engines Done Right Co. is trying to establish the standard labor cost of a typical engine tune-up. The following data have been collected from time
Engines Done Right Co. is trying to establish the standard labor cost of a typical engine tune-up. The following data have been collected from time and motion studies conducted over the past month. Instructions: (a) Actual time spent on the tune-up Hourly wage rate Payroll taxes Setup and downtime Cleanup and rest periods Fringe benefits 1.0 hour $16 10% of wage rate 10% of actual labor time 20% of actual labor time 25% of wage rate Determine the standard direct labor hours per tune-up (b) Determine the standard direct labor hourly rate. (c) (d) Determine the standard direct labor cost per tune-up. If a tune-up took 1.5 hours at the standard hourly rate, what was the direct labor quantity variance
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