Meeds Company Uses the Following Rule to Determine Whether Labour

question 119

Essay

Meeds Company uses the following rule to determine whether labour efficiency variances should be investigated:
A labour efficiency variance will be investigated when the variance is greater than either $100 or 10% of the standard labour cost.
During March,the company used 525 direct labour hours at a rate of $16 per hour.Its standard rate is 500 direct labour hours at a rate of $15.50 per hour.
A. Determine the company's labour efficiency variance and whether it is favourable or unfavourable.
B. Should the variance be investigated?

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Definitions:

GDP

Gross Domestic Product, the total market value of all final goods and services produced within a country in a given period, a measure of economic performance.

Economic Well-being

The level of prosperity and quality of life in an economy, measured by factors such as income, employment, and access to goods and services.

GDP

Gross Domestic Product, the total market value of all final goods and services produced within a country in a specific time period, serving as a broad measure of economic activity.

Economy's Production

The total value of all goods and services produced within an economy over a specific time period.