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E11-4 Monte Services, Inc. is trying

Price: $1.99


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  1.0 hour 
Hourly wage rate  $12
Payroll taxes  10% of wage rate 
Setup and downtime  20% of actual labor time 
Cleanup and rest periods  30% of actual labor time 
Fringe benefits  25% of wage rate 

Instructions
(a) Determine the standard direct labor hours per oil change.
(b) Determine the standard direct labor hourly rate.
(c) Determine the standard direct labor cost per oil change.
(d) If an oil change took 1.6 hours at the standard hourly rate, what was the direct labor
quantity variance?

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