health Construction builds standard prefabricated wooden frames for walls. Each frame requires 10 direct labot hours and the standard hourly direct labor rate is $ 18. During July, the company produced 670 frames and worked 6,800 direct labor hours. Payroll records indicate that workers earned $ 127, 500. a. What were the standard hours for July construction? Solution Standard Hours for July construction =? Standard Hours for July construction = 10 Hours x 670 frames Standard Hours for July construction = 6700 Hours b. Calculate the direct labor variances. Solution Direct labor variances =? Formula Direct labor variances =Actual Cost – [Standard rate x Standard Hours] Calculation Direct labor variances = $127,500 – [ $18 x 6700] Direct labor variances = $127,500 – $120,600 Direct labor variances = 6,900 unfavorable c. What was the actual hourly wage rate? Solution Actual hourly wage rate =? Actual hourly wage rate =$127,500 / 6,800 hours Actual hourly wage rate = $18.75 per hour

health Construction builds standard prefabricated wooden frames for walls. Each frame requires 10 direct labot hours and the standard hourly direct labor rate is $ 18. During July, the company produced 670 frames and worked 6,800 direct labor hours. Payroll records indicate that workers earned $ 127, 500.

a.       What were the standard hours for July construction?

Solution

Standard Hours for July construction =?

Standard Hours for July construction = 10 Hours x 670 frames

Standard Hours for July construction = 6700 Hours

b.      Calculate the direct labor variances.

Solution

Direct labor variances =?

Formula

Direct labor variances =Actual Cost – [Standard rate x Standard Hours]

Calculation

Direct labor variances = $127,500 – [ $18 x 6700]

Direct labor variances = $127,500 – $120,600

Direct labor variances = 6,900 unfavorable

c. What was the actual hourly wage rate?

Solution

Actual hourly wage rate =?

Actual hourly wage rate =$127,500 / 6,800 hours

Actual hourly wage rate = $18.75 per hour