The performance report of Custom Jewelry included the following variances for direct labor: price (rate) variance, $4,000 favorable; quantity (efficiency) variance, $14,000 unfavorable. For each finished unit, the standard hourly direct labor rate was $7. The actual hours were 5,000 because 1.25 actual hours is required for each of the 4,000 finished units.

a. What was the actual rate per hour?

b. What were the standard direct labor hours allowed for production?

c. Since the price (rate) variance was favorable and the quantity (efficiency) variance unfavorable, can the production supervisor conclude that unskilled workers caused the hours to be higher than the allowed hours for the flexible budget of actual units produced? Discuss.