Item3

10points

eBookHint

Print

References

Check my workCheck My Work button is now enabled

Item 3

Exercise 10-5 (Algo) Working Backwards from Labor Variances [LO10-2]

Quality Motor Company is an auto repair shop that uses standards to control its labor time and labor cost. The standard labor cost for a motor tune-up is given below:

	Standard Hours	Standard Rate	Standard Cost
Motor tune-up	2.50	$ 35.00	$ 87.50

The record showing the time spent in the shop last week on motor tune-ups has been misplaced. However, the shop supervisor recalls that 60 tune-ups were completed during the week, and the controller recalls the following variance data relating to tune-ups:

Labor rate variance	$ 50	F
Labor spending variance	$ 55	U

Required:

1. Determine the number of actual labor-hours spent on tune-ups during the week.

2. Determine the actual hourly pay rate for tune-ups last week. (Round your answer to 2 decimal places.)

Bandar Industries manufactures sporting equipment. One of the companys products is a football helmet that requires special plastic. During the quarter ending June 30, the company manufactured 3,500 helmets, using 2,485 kilograms of plastic. The plastic cost the company $18,886.

According to the standard cost card, each helmet should require 0.61 kilograms of plastic, at a cost of $8.00 per kilogram.

Required:

1. What is the standard quantity of kilograms of plastic (SQ) that is allowed to make 3,500 helmets?

2. What is the standard materials cost allowed (SQ SP) to make 3,500 helmets?