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27 November, 23:37

Swan Company has a direct labor standard of 15 hours per unit of output. Each employee has a standard wage rate of $14 per hour. During March, employees worked 13,100 hours. The direct labor rate variance was $9,170 favorable, the direct labor efficiency variance was $15,400 unfavorable. What was the actual payroll?

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  1. 28 November, 01:08
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    the actual payroll is $189,630

    Explanation:

    Calculation of Standard Payroll Cost

    Standard Payroll Cost (flexed) = 13,100 hours*$14 per hour

    = $183,400

    Reconciling the Standard Payroll Cost to Actual Payroll Cost

    Standard Payroll Cost (flexed) $183,400

    Add unfavorable direct labor efficiency variance $15,400

    Less favorable direct labor rate variance ($9,170)

    Actual Payroll Cost 189,630
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