Question

Calculating Standard Quantities for Actual Production Guillermo's Oil and Lube Company is a service company that offers oil changes and lubrication for automobiles and light trucks. On average, Guillermo has found that a typical oil change takes 30 minutes and 6.6 quarts of oil are used. In June, Guillermo's Oil and Lube had 940 oil changes. Required: 1. Calculate the number of quarts of oil that should have been used (SQ) for 940 oil changes. fill in the blank 1 quarts 2. Calculate the hours of direct labor that should have been used (SH) for 940 oil changes. fill in the blank 2 direct labor hours 3. What if there had been 930 oil changes in June

Answer 1

Guillermo's Oil and Lube Company

1. The number of quarts of oil that should have been used (Standard Quantity) for 940 changes is:

= 6,204 quarts.

2. The hours of direct labor that should have been used (Standard Hours) for 940 oil changes is:

= 470 hours.

Step-by-step explanation:

a) Data and Calculations:

Time taken for a typical oil change = 30 minutes or 0.5 hours (30/60)

Standard quarts of oil for a typical oil change = 6.6 quarts

Total oil changes in June = 940

1. The number of quarts of oil that should have been used (Standard Quantity) for 940 changes = 6,204 (940 * 6.6) quarts

2. The hours of direct labor that should have been used (Standard Hours) for 940 oil changes = 470 (0.5 * 940) hours