Answer:
Direct Labor Rate Variance = $22,500 Unfavorable
Explanation:
Direct Labor Rate Variance = (Standard Rate Per hour - Actual Rate per hour) Actual Hours
Here, Actual units = 9,000
Therefore standard hours = 9,000 2.4 = 21,600 hours
Actual hours = 9,000 2.5 = 22,500
Standard rate per hour = $20
Actual rate per hour = $21
Thus,
Direct Labor Rate Variance = ($20 - $21) 22,500 = - $22,500
As the actual rate at which labor is paid are much higher than the standard rate the variance is unfavorable.
Direct Labor Rate Variance = $22,500 Unfavorable