Calculating the direct labor rate and time variances


Response to the following problem:

Alpine Bicycle Company manufactures mountain bikes. The following data for May of the current year are available:

Quantity of direct labor used ............... 600 hrs.

Actual rate for direct labor ........... $12.50 per hr.

Bicycles completed in May ...................... 280

Standard direct labor per bicycle .............. 2 hrs.

Standard rate for direct labor ......... $12.75 per hr.

Planned bicycles for May .......................... 310

Determine the direct labor rate and time variances.

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Cost Accounting: Calculating the direct labor rate and time variances
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