Question

Krizun Industries makes heavy construction equipment. The standard for a particular crane calls for 14 direct labor-hours at $16 per direct labor-hour. During a recent period 1,000 cranes were made. The labor efficiency variance was $4,400 Unfavorable. How many actual direct labor-hours were worked

Answer 1

14,275= actual hours

Step-by-step explanation:

Giving the following information:

The standard for a particular crane calls for 14 direct labor-hours at $16 per direct labor-hour.

During a recent period, 1,000 cranes were made.

The labor efficiency variance was $4,400 Unfavorable.

To determine the actual hours worked, we need to use the direct labor efficiency variance formula:

Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate

-4,400= (14*1,000 - actual hours)*16

-4,400= 224,000 - 16actual hours

228,400/16= actual hours

14,275= actual hours