Question

w of direct labor e s the following summary data Exercise 23-10 During March 2017, Toby Tools Alt Job Number Hours Costs 210 54,410 230 10,320 3005,550 120 2,280 Company worked on four job a ndard Hours Costa Total Variance 215 54,536 4103,510 1.210 u 2085,258 1 15 2,415 51,851 U Analysis reveals that Job A257 was a reput jojob A258 was a rush order that required overtime work at premium rates av Job A259 red a more experienced replacement work on shill Work Job A260 was done for one day by w trains when a regular work was . Prepare report for the plant spurv on direct labor ces variance for March. Round quality variance, actualme, standard rate and price race to 2 decimal places A260

Exercise 23-10

During March 2017, Toby Tool & Die Company worked on four jobs. A review of direct labor costs reveals the following summary data.

		Actual				Standard
Job Number		Hours		Costs		Hours		Costs		Total Variance
A257		210		$4,410		216		$4,536		$126	F
A258		430		10,320		410		8,610		1,710	U
A259		300		6,660		298		6,258		402	U
A260		120		2,280		115		2,415		135	F
Total variance										$1,851	U

Analysis reveals that Job A257 was a repeat job. Job A258 was a rush order that required overtime work at premium rates of pay. Job A259 required a more experienced replacement worker on one shift. Work on Job A260 was done for one day by a new trainee when a regular worker was absent.

Prepare a report for the plant supervisor on direct labor cost variances for March. (Round quantity variance, actual rate, standard rate and price variance to 2 decimal places, e.g. 10.50.)

TOBY TOOL & DIE COMPANY Direct Labor Variance Report March 31, 2017For the Year Ended March 31, 2017For the Month Ended March 31, 2017

Job No.

Actual Hours

Standard Hours

Quantity Variance

Actual Rate

Standard Rate

Price Variance

A257

$

FavorableUnfavorableNeither favorable nor unfavorable

$

$

$

FavorableNeither favorable nor unfavorableUnfavorable

A258

UnfavorableFavorableNeither favorable nor unfavorable

$

$

Neither favorable nor unfavorableUnfavorableFavorable

A259

UnfavorableFavorableNeither favorable nor unfavorable

$

$

UnfavorableFavorableNeither favorable nor unfavorable

A260

UnfavorableFavorableNeither favorable nor unfavorable

$

$

UnfavorableNeither favorable nor unfavorableFavorable

Totals

$

UnfavorableFavorableNeither favorable nor unfavorable

$

UnfavorableNeither favorable nor unfavorableFavorable

Answer 1

Answer

TOBY TOOL & DIE COMPANY
Direct Labor Variance Report
For the Month Ended March 31, 2017
Job No.	Actual Hours	Standard Hours	Quantity Variance		Actual Rate	Standard Rate	Price Variance
A257	210	216	$ 126.00	Favorable	$    21.00	$    21.00	$          0.00	Neither favorable nor unfavorable
A258	430	410	$ 420.00	Unfavorable	$    24.00	$    21.00	$ 1,290.00	Unfavorable
A259	300	298	$    42.00	Unfavorable	$    22.20	$    21.00	$     360.00	Unfavorable
A260	120	115	$ 105.00	Unfavorable	$    19.00	$    21.00	$     240.00	Favorable
		Totals	$ 441.00	Unfavorable			$ 1,410.00	Unfavorable

Calculation

Job Number	Actual Costs	Divided by: Hours	Actual rate
A257	$          4,410	210	$      21.00
A258	$        10,320	430	$      24.00
A259	$          6,660	300	$      22.20
A260	$          2,280	120	$      19.00
Job Number	Standard Costs	Divided by: Hours	Standard rate
A257	$          4,536	216	$      21.00
A258	$          8,610	410	$      21.00
A259	$          6,258	298	$      21.00
A260	$          2,415	115	$      21.00

Job Number: A257
Minus sign indicate Favorable variance.
	Measure	Hour
	Standard rate per Hour	$           21.00
	Actual rate per Hour	$           21.00
	Standard labor Hours	216
	Actual labor Hours	210
	Actual rate per Hour	21.00
Less	Standard rate per Hour	-21.00
	Difference	0.00
Multiply	Actual labor Hours	210
	Labor price variance	$             0.00
	Indicate	No Variance
	Actual labor Hours	210
Less	Standard labor Hours	-216
	Difference	-6
Multiply	Standard rate per Hour	21.00
	Labor quantity variance	$      (126.00)
	Indicate	Favorable
	Total Labor cost variance (Total of both variance)	$            (126)
	Indicate	Favorable

Job Number: A258
Minus sign indicate Favorable variance.
	Measure	Hour
	Standard rate per Hour	$            21.00
	Actual rate per Hour	$            24.00
	Standard labor Hours	410
	Actual labor Hours	430
	Actual rate per Hour	24.00
Less	Standard rate per Hour	-21.00
	Difference	3.00
Multiply	Actual labor Hours	430
	Labor price variance	$      1,290.00
	Indicate	Unfavorable
	Actual labor Hours	430
Less	Standard labor Hours	-410
	Difference	20
Multiply	Standard rate per Hour	21.00
	Labor quantity variance	$         420.00
	Indicate	Unfavorable
	Total Labor cost variance (Total of both variance)	$            1,710
	Indicate	Unfavorable

Job Number: A259
Minus sign indicate Favorable variance.
	Measure	Hour
	Standard rate per Hour	$    21.00
	Actual rate per Hour	$    22.20
	Standard labor Hours	298
	Actual labor Hours	300
	Actual rate per Hour	22.20
Less	Standard rate per Hour	-21.00
	Difference	1.20
Multiply	Actual labor Hours	300
	Labor price variance	$ 360.00
	Indicate	Unfavorable
	Actual labor Hours	300
Less	Standard labor Hours	-298
	Difference	2
Multiply	Standard rate per Hour	21.00
	Labor quantity variance	$    42.00
	Indicate	Unfavorable
	Total Labor cost variance (Total of both variance)	$        402
	Indicate	Unfavorable

Job Number: A260
Minus sign indicate Favorable variance.
	Measure	Hour
	Standard rate per Hour	$               21.00
	Actual rate per Hour	$               19.00
	Standard labor Hours	115
	Actual labor Hours	120
	Actual rate per Hour	19.00
Less	Standard rate per Hour	-21.00
	Difference	-2.00
Multiply	Actual labor Hours	120
	Labor price variance	$           (240.00)
	Indicate	Favorable
	Actual labor Hours	120
Less	Standard labor Hours	-115
	Difference	5
Multiply	Standard rate per Hour	21.00
	Labor quantity variance	$             105.00
	Indicate	Unfavorable
	Total Labor cost variance (Total of both variance)	$                 (135)
	Indicate	Favorable