Labor Ratios

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August 15, 2021 at 1:10 pm #631648

maximus07
Participant

Sir I read your comment on the previous question. I don’t want you to solve just give me a hint that idle hours will affect which of these three ratios?

Budgeted hours – 12000
Budgeted Units – 4000
Actual hours – 14000
Actual units – 4500
Labor is said to be idle for 1500 hours.
Find:
(A) Efficiency Ratio
(B) Capacity utilisation Ratio
(C) Production Volume ratio

August 16, 2021 at 3:00 pm #631755

johnbriane
Member

And dear sir

If efficiency ratio is more than 100% can we say our capacity variance will be a favorable one always provided this is the situation
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