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In a period, 6,500 units were made. There was an adverse labour efficiency variance of $26,000. Workers were paid at $8 per hour which was equal to the standard labour rate. Total wages were $182,000. Calculate the standard labour hours cost per unit.
*The answer is $3.5 and i dont get why that is the answer. if the question was asking the standard labour hours per unit only then yes, 3 hours. but it asks standard labour hours COST per unit. can you help me? thank you 🙂
The answer of $3.50 makes no sense.
The standard hours per unit is indeed 3 hours, and therefore the standard cost per unit for labour is 3 x $8 = $24 per unit.
It seems that there is an error in your book. If it is a question from the BPP Revision Kit then tell me which one so I can check.
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