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In labour efficiency variance , for actual hours , they have taken actual hours paid for ,ie, 40 *no of workers .. for efficiency shouldn’t it be total hours WORKED and not paid ? So I am asking why it isn’t 36hrs *no of workers
Answers (8)
CA Suraj Lakhotia Admin
How did you calculate 36 hours?
1,800 labour hours actuals .. so 1,800 distributed by ratio .. giving 1152,432,216 hours respectively … now dividing by actual number of workers , ie,32,12,6 respectively , it comes 36 labour hrs per worker
Thread Starter
SANSKRITI BADRI 21113391,800 labour hours actuals .. so 1,800 distributed by ratio .. giving 1152,432,216 hours respectively … now dividing by actual number of workers , ie,32,12,6 respectively , it comes 36 labour hrs per worker
Working for 40 hrs resulting in actual output equivalent of 1800 hrs.
Pranay Mehta Faculty
Working for 40 hrs resulting in actual output equivalent of 1800 hrs.
Then how come we found 1,800 and divided it into the proportion to get 1152 ,etc? Then shouldn’t the hours worked remain the same as the standard .. does the fact that we are changing the labour hours mean that they have worked for less hours ?
Thread Starter
SANSKRITI BADRI 2111339Then how come we found 1,800 and divided it into the proportion to get 1152 ,etc? Then shouldn’t the hours worked remain the same as the standard .. does the fact that we are changing the labour hours mean that they have worked for less hours ?
They have worked for 2000 hrs and output is equivalent to 1800 std hrs of work. Prima facie it shows their inefficiency.
Thread Starter
SANSKRITI BADRI 2111339Then how come we found 1,800 and divided it into the proportion to get 1152 ,etc? Then shouldn’t the hours worked remain the same as the standard .. does the fact that we are changing the labour hours mean that they have worked for less hours ?
Standards are always calculated for actual output. For example if 100 units take 100 hrs standard time and during a period actual production is 90 units by taking 100 hrs we calculate std time as 90 hrs ( 1hr for each unit)
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