Mile High Club Incorporated, prepares in-flight meals for a number of major airlines. One of the companys products is grilled salmon with new potatoes and mixed vegetables. During the most recent week, the company prepared 4,000 of these meals using 960 direct labor hours. The company paid its direct labor workers a total of $19,200 for this work or $20.00 per hour.

According to the standard cost card for this meal, it should require 0.25 direct labor hours at a cost of $19.75 per hour.

Required:

1. What is the standard labor hours allowed (SH) to prepare 4,000 meals?

2. What is the standard labor cost allowed (SH SR) to prepare 4,000 meals?

3. What is the labor spending variance?

4. What are the labor rate variance and the labor efficiency variance?