{"id":209487,"date":"2025-04-29T06:58:29","date_gmt":"2025-04-29T06:58:29","guid":{"rendered":"https:\/\/learnexams.com\/blog\/?p=209487"},"modified":"2025-04-29T06:58:32","modified_gmt":"2025-04-29T06:58:32","slug":"hassock-corp-produces-woven-wall-hangings","status":"publish","type":"post","link":"https:\/\/www.learnexams.com\/blog\/2025\/04\/29\/hassock-corp-produces-woven-wall-hangings\/","title":{"rendered":"Hassock Corp. produces woven wall hangings"},"content":{"rendered":"\n<p>Hassock Corp. produces woven wall hangings. It takes 4 hours of direct labor to produce a single wall hanging. Hassock&#8217;s standard labor cost is $16 per hour. During August, Hassock produced 15,000 units and used 60,170 hours of direct labor at a total cost of $960,720. What is Hassock&#8217;s labor rate variance for August?<\/p>\n\n\n\n<p>Multiple Choice<\/p>\n\n\n\n<p>$1,994 favorable.<br>$2,000 unfavorable.<br>$2,000 favorable.<br>$3,994 favorable.<br>$1,994 unfavorable.<\/p>\n\n\n\n<p><mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-ast-global-color-6-color\"><strong>The correct answer and explanation is :<\/strong><\/mark><\/p>\n\n\n\n<p>To calculate Hassock Corp.&#8217;s labor rate variance, we need to follow the formula for labor rate variance:<\/p>\n\n\n\n<p>[<br>\\text{Labor Rate Variance} = (\\text{Actual Hours} \\times \\text{Actual Rate}) &#8211; (\\text{Actual Hours} \\times \\text{Standard Rate})<br>]<\/p>\n\n\n\n<p>Where:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Actual Hours<\/strong> = 60,170 hours<\/li>\n\n\n\n<li><strong>Actual Rate<\/strong> = Total Cost \/ Actual Hours = $960,720 \/ 60,170 hours = $15.97 per hour<\/li>\n\n\n\n<li><strong>Standard Rate<\/strong> = $16 per hour<\/li>\n<\/ul>\n\n\n\n<p>Now, we can calculate the labor rate variance step by step:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Step 1: Calculate the total cost at the standard rate<\/h3>\n\n\n\n<p>At the standard rate, if Hassock had used the actual number of hours (60,170), the total cost would have been:<br>[<br>60,170 \\text{ hours} \\times 16 \\text{ per hour} = 962,720 \\text{ dollars}<br>]<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Step 2: Find the difference between the actual cost and the standard cost<\/h3>\n\n\n\n<p>The actual total cost was $960,720. Therefore, the difference between the standard cost and the actual cost is:<br>[<br>962,720 &#8211; 960,720 = 2,000 \\text{ favorable}<br>]<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Step 3: Interpret the result<\/h3>\n\n\n\n<p>Since the actual labor cost is less than the standard cost, this results in a favorable variance.<\/p>\n\n\n\n<p>Thus, the labor rate variance for August is <strong>$2,000 favorable<\/strong>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Explanation:<\/h3>\n\n\n\n<p>The labor rate variance measures the difference between what was actually paid for labor and what should have been paid at the standard rate, given the number of hours worked. A <strong>favorable<\/strong> variance occurs when the actual rate is <strong>less than<\/strong> the standard rate, meaning the company paid less per hour than planned. In this case, although the company used more hours than expected (60,170 hours vs. 60,000 hours), the labor cost per hour was less than expected, leading to a favorable variance of $2,000.<\/p>\n\n\n\n<p>Thus, the correct answer is: <strong>$2,000 favorable<\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Hassock Corp. produces woven wall hangings. It takes 4 hours of direct labor to produce a single wall hanging. Hassock&#8217;s standard labor cost is $16 per hour. During August, Hassock produced 15,000 units and used 60,170 hours of direct labor at a total cost of $960,720. What is Hassock&#8217;s labor rate variance for August? Multiple [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[25],"tags":[],"class_list":["post-209487","post","type-post","status-publish","format-standard","hentry","category-exams-certification"],"_links":{"self":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/209487","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/comments?post=209487"}],"version-history":[{"count":0,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/209487\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/media?parent=209487"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/categories?post=209487"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/tags?post=209487"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}