Ritchie Ventura operates a commercial painting business in Ontario, which has a very tight labour market. Much of his work focuses on newly constructed apartments and townhouses.
The following data relate to crew no. 5 for a recently concluded period when 85 apartment units were painted:
▪ Three new employees were assigned to crew no. 5. Wages averaged $18.80 per hour for each employee; the crew took 2,550 hours to complete the work.
▪ Based on his knowledge of the operation, articles in trade journals, and conversations with other painters, Ventura established the following standards:
▪ The paint quantity variance was $6,070F.
▪ The operation did not go as smoothly as planned, with customer complaints and problems being much higher than expected.
Typical hourly wage rate of crew personnel: $15
Anticipated crew time for each unit: 34 hours
Required:
A. Compute Ventura's direct-labour variances.
B. Is the direct-labour rate variance consistent with what you might expect in a tight labour market? Explain.
C. Analyze the information given and that you calculated, and determine what likely happened that would give rise to customer complaints

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The Answer of Ritchie Ventura operates a commercial painting business in Ontario, which has a very tight labour market. Much of his work focuses on newly constructed apartments and townhouses.
The following data relate to crew no. 5 for a recently concluded period when 85 apartment units were painted:
▪ Three new employees were assigned to crew no. 5. Wages averaged $18.80 per hour for each employee; the crew took 2,550 hours to complete the work.
▪ Based on his knowledge of the operation, articles in trade journals, and conversations with other painters, Ventura established the following standards:
▪ The paint quantity variance was $6,070F.
▪ The operation did not go as smoothly as planned, with customer complaints and problems being much higher than expected.
Typical hourly wage rate of crew personnel: $15
Anticipated crew time for each unit: 34 hours
Required:
A. Compute Ventura's direct-labour variances.
B. Is the direct-labour rate variance consistent with what you might expect in a tight labour market? Explain.
C. Analyze the information given and that you calculated, and determine what likely happened that would give rise to customer complaints

Ritchie Ventura Operates a Commercial Painting Business in Ontario, Which