Custom Clubs produces handmade golf clubs. The process is labor intensive. The speed at which a club can be built depends on the skill level of the individual worker.
| Custom Clubs produces handmade golf clubs. The process is labor intensive. The speed at which a club can be built
depends on the skill level of the individual worker. Management has established a standard of 2
labor hours per club. The standard
wage rate is $12 per hour. During a
recent month, 2,500 custom clubs were produced. Management was pleased that only 4,900
labor hours were worked; however, total wages amounted to $63,700. Compute the total variance for labor, and determine how much is related to rate and efficiency components. |
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