Ten Minutes of Direct Labour Is Needed to Produce One

question 8

Multiple Choice

Ten minutes of direct labour is needed to produce one unit of product and direct labour is paid $24 per hour. Budgeted output for the period is estimated to be 8000 units. Actual output for the period turns out to be 8500 units and actual labour costs are $36 200 What budgeted direct labour amount should actual direct labour costs be compared to in order to calculate a valid variance?

• A) $32 000
• B) $19 200
• C) $20 400
• D) $34 000

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Definitions:

Job Involvement

A cognitive state of psychological identification with one’s job and the importance of work to one’s total self-image.

Relational Architecture

The design and structure of relationships within an organization, including how communication, authority, and tasks are organized.

Job Autonomy

The degree of freedom and discretion allowed to an employee over their work tasks and processes.

Work Design Characteristics

Attributes of the task, job, and social and organizational environment.