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Dear John,
q31 a) (iii) on labour rate variance. In the solution they calculated 275 hrs as excess hrs for the permanent staff I totally agree. However what I’m failing to understand is were the temporary staff employed to work for the excess hours only.Kindly, clarify.
The permanent staff were only able to work for 2,200 hours, and so the extra hours needed were all worked by temporary staff. Had they been as efficient as the permanent staff they would only have needed to work 275 hours, but because they take twice as long they actually had to work 2 x 275 hours.
Noted. I thought the permanent staff were being very efficient by working 2200hrs instead of 2475 hrs
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