Question

The following data pertain to operations concerning the product for the last month: Actual hours worked 8,100 hours Actual total labor cost $119,880 Actual output 800 units What is the labor rate variance for the month?

Answer 1

Answer:

Instructions are below.

Explanation:

Giving the following information:

We weren't provided with enough information to solve the requirement. But, I will provide an example and the formula to guide an answer.

For example:

Standard rate per hour= $15

Actual hours worked 8,100 hours

Actual total labor cost $119,880

To calculate the direct labor rate variance, we need to use the following formula:

Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity

Actual rate= 119,880/8,100= $14.8

Direct labor rate variance= (15 - 14.8)*8,100

Direct labor rate variance= $1,620 favorable