TWO QUESTIONS ARE CONNECTED TOGETHER! QUESTION 1: Labor Rate Variance Bruce incurred actual direct labor costs of $14,04

[answerhappygod]

TWO QUESTIONS ARE CONNECTED TOGETHER!
QUESTION 1:
Labor Rate Variance
Bruce incurred actual direct labor costs of $14,040 in
March.
Standard hourly Labor rate $13
The standard labor cost allowed for manufacturing 600 beams is
only $11,700 (600 units ×
1.5 hours per unit × $13 per hour).
Thus, the company is faced with an unfavorable labor variance of
$2,340 ($11,700 −
$14,040).
Timecards show that 2,075 Actual direct labor hours were used in
March.
The average wage rate for the month was $14per hour. (Actual
rate = $14)
Calculate the labor rate variance
Labor Rate Variance = Actual direct Labor Hours ×
(Standard hourly labor Rate – Actual Rate)
QUESTION 2: *Note this question builds on
question 1
The labor efficiency variance (also called the labor usage
variance) is a measure of worker productivity.
The labor efficiency variance is computed by multiplying the
standard hourly wage rate by the difference between the standard
hours allowed and actual hours used.
Bruce allows 900 standard labor hours to produce 600 beams (600
units × 1.5 hours per unit).
Standard hourly Labor rate $13
Timecards show that 2,075 Actual direct labor hours were used in
March.
Compute the labor efficiency
variance: *Note this question builds on question
1
Given that 2,075 hours were actually required, the
company’s unfavorable labor efficiency variance for March is
computed as follows.
Labor Efficiency Variance = Standard Hourly labor Rate ×
(Standard labor Hours – Actual Direct labor
Hours)