Exercise 25-4, Monte Services, Inc.

Exercise 25-4, Monte Services, Inc. for $18 OnlyExercise 25-4, Monte Services, Inc.

Monte Services, Inc. is trying to establish the standard labor cost of a typical oil change. The following data have been collected from time and motion studies conducted over the past month.

Actual time spent on the oil change

2.00 hour
Hourly wage rate

$14
Payroll taxes

14% of wage rate
Setup and downtime

6% of actual labor time
Cleanup and rest periods

34% of actual labor time
Fringe benefits

27% of wage rate

(a) Determine the standard direct labor hours per oil change. (Round answer to 2 decimal places, e.g. 1.25.)

Standard direct labor hours per oil change

hours

(b) Determine the standard direct labor hourly rate. (Round answer to 2 decimal places, e.g. 1.25.)

Standard direct labor hourly rate

$

Determine the standard direct labor cost per oil change. (Round answers to 2 decimal places, e.g. 1.25.)

Standard direct labor cost per oil change

$

If an oil change took 2.6 hours at the standard hourly rate, what was the direct labor quantity variance? (Round answers to 2 decimal places, e.g. 1.25.)

Direct labor quantity variance

$

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