I-17.

03

In the boxed areas provided, enter actual hours, standard hours, actual labor rate, and standard labor rate.
Labor variances will be automatically calculated, along with related journal entries. The initial values that
are already entered correspond to values used in the example in the textbook. Try alternative values and
closely consider and evaluate the changes to the variance calculations.

Enter the actual hours used in production >>>> 12,500

Enter the standard hours that should have been used >>>> 10,200

Enter the actual labor rate >>>> $ 14.00

Enter the standard labor rate >>>> $ 18.00

Actual cost Standard cost

12,500 10,200

Total
14.00 18.00
variance

$ 175,000.00 $ 8,600.00 $ 183,600.00

Actual use @
standard
 I-17.03

12,500

Rate Efficiency
18.00
Variance Variance

$ 50,000.00 $ 225,000 $ (41,400.00)

Work in Process Inventory 183,600.00

Labor Efficiency Variance 41,400.00
Labor Rate Variance 50,000.00
Wages Payable 175,000.00

To increase work in process for the standard direct labor costs and
record the related efficiency and rate variances