Question

In: Accounting

Exercise D6-16 Workers at Bonita News were paid a total of $25,680 during the month of...

Exercise D6-16 Workers at Bonita News were paid a total of $25,680 during the month of July. The company’s standard wage rate was $6 per hour, and the direct labor rate variance for the month was $1,092 Unfavorable. How many direct labor hours were worked during July? Direct labor hours

Solutions

Expert Solution

Direct Labor hours 4,098 hours

Working:

Direct Labor rate variance = (Standard rate-Actual rate)*Actual labor hours
or,
Direct Labor rate variance = (Standard rate*Actual labor hours)-(Actual rate*Actual labor hours)
or,
Direct Labor rate variance = (Standard rate*Actual labor hours)-(Actual labor costs)
or,
$                                       1,092 Unfavorable = (Standard rate*Actual labor hours)-25680
$                                    24,588 = Standard rate*Actual labor hours
or,
$                                    24,588 = $ 6 *Actual labor hours
or,
Actual labor hours = 4,098

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