Question

Krizun Industries makes heavy construction equipment. The standard for a particular crane calls for 20 direct labor-hours at $24 per direct labor-hour. During a recent period 875 cranes were made. The labor efficiency variance was $1,200 Unfavorable. How many actual direct labor-hours were worked? Group of answer choicesa. 28,850
b. 23,750
c. 24,090
d. 22,500

Answer 1

Answer:

Actual Hours = 17450

Explanation:

Krizun Industries

The labor efficiency variance= (Standard Hours allowed for expected Output * standard labor Rate )- ( Standard Hours allowed for Actual Output * standard labor Rate )

Labor Efficiency Variance= (SH* SR)- (AH*SR)

Labor Efficiency Variance= (20 * 875 *24 )- (AH* 24)

$ 1200 - 420000= -(AH*24)

-418800/24=-(AH)

Actual Hours = 17450

Actual Hours per unit = 17450/875= 19.94