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Four Seasons Industries has established direct labor performance standards for its maintenance and repair shop. However, some of the labor records were destroyed during a
Four Seasons Industries has established direct labor performance standards for its maintenance and repair shop. However, some of the labor records were destroyed during a recent fire. The actual hours worked during August were 2.250, and the total direct labor budget variance was $1170 unfavorable. The standard labor rate was 514 40 per hour, but recent resignations allowed the firm to hire lower-paid replacement workers for some jobs, and this produced a favorable rate variance of $3,150 for August Required: a. Calculate the actual direct labor rate paid per hour during August (Do not round Intermediate calculations. Round your answer to 1 decimal place.) b. Calculate the dollar amount of the direct labor efficiency variance for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (ie, zero variance)) c. Calculate the standard direct labor hours allowed for the actual level of activity during August. (Hint Use the formula for the quantity variance and solve for the missing information Actual direct labor rate per hour b Direct labor efficiency variance Standard direct labor hours
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