Question

The following data are given for Harry Company:

Answer 1

Question

Kindly note that the original question is not complete. The closest question found similar to the original is given below.

The following data are given for Harry Company:

Budgeted production 1,001 units

Actual production 920 units

Materials:

Standard price per ounce $1.904

Standard ounces per completed unit 10

Actual ounces purchased and used in

production 9,476

Actual price paid for materials $19,426

Labor:

Standard hourly labor rate $14.09 per hour

Standard hours allowed per completed unit 4.3

Actual labor hours worked 4,738

Actual total labor costs $76,993

Overhead:

Actual and budgeted fixed overhead $1,155,000

Standard variable overhead rate $27.00 per standard labor hour

Actual variable overhead costs $132,664

Overhead is applied on standard labor hours.

Determine the labour rate variance.

Answer:

Labour rate variance $10,234.58 unfavorable

Explanation:

The labour rate variance is the difference between the standard labour cost allowed for the actual hours worked and the actual labor cost for the same hours                                                                                          

Actual labour hours = 4,738

                                                                                          $

4,738  hours should have cost (4,738 ×  $14.09) =  66,758.42                  

but did cost  (actual cost)                                           76,993.00

labour rate variance                                                    10,234.58 unfavorable  

Labour rate variance $10,234.58 unfavorable