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Alex17521
2 months ago
6

The Fime Corporation uses a standard costing system. The following data have been assembled for December: Actual direct labor-ho

urs worked 6,200 hours Standard direct labor rate $7 per hour Labor efficiency variance $2,100 Unfavorable The standard hours allowed for December’s production is:
Business
2 answers:
soldi70 [3.6K]2 months ago
7 0

Response:

5,900 = standard amount

Clarification:

Based on the information provided:

Actual labor-hours recorded were 6,200 hours

Standard labor cost is $7 for each hour

Labor efficiency variance indicates $2,100 as unfavorable

To find the standard hours, we apply the following equation:

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

-2,100 = (standard amount - 6,200)*7

-2,100 = 7 standard amount - 43,400

41,300/7 = standard amount

5,900 = standard amount

harina [3.8K]2 months ago
4 0

Answer:

The standard hours permitted for December production totals 5,900 hours

Explanation:

To resolve this, we employ the labor efficiency variance formula.

Labor efficiency variance = Standard rate (Standard hours - Actual hours)

Plugging in the values from the question:

-$2,100 = $7(Standard hours - 6,200)

-$2,100 = 7std hr - 43,400

7 Std hr = - $2,100 + $43,400

7 Std hr = $41,300

std hr = 5,900 hours

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