Direct Labor Efficiency Variance Assignment
Assume the following set of facts for questions 5-6.
Puig corp. has developed some standard costs for the year based on a capacity of 180,000 direct labor hours as follows (Puig uses direct labor hours as a base for overhead):
Cost per unit:
direct materials 4 pounds @ $7 = $28
fixed overhead 2 hours @ $4 = 8
During the year, 90,000 units were scheduled for production; however, only 80,000 units were actually produced. The following data relate to the year:
Direct labor efficiency variance of $20,000 u.
Actual direct labor hours were 165,000.
The denominator level of volume was 180,000 direct labor hours.
____ 5. The standard wage per hour for direct labor is:
(a) $ 6
(b) $ 5
(c) $ 4
(d) $ 3
(e) none of the above, the correct answer is ________.
___ 6. The production volume variance for the year is:
(a) $60,000 f
(b) $60,000 u
(c) $30,000 u
(d) $30,000 f
(e) none of the above, the correct answer is _________..