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3 June, 13:42

The Fellowes Company has developed standards for labor. During June, 85 units were scheduled and 110 were produced. Data related to labor are: Standard hours allowed 2 hours per unit Standard wages allowed $ 4.00 per hour Actual direct labor 230 hours (total cost $897) What is the labor rate variance for June?

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  1. 3 June, 13:54
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    Direct labor rate variance = 23 favorable

    Explanation:

    Giving the following information:

    During June, 85 units were scheduled and 110 were produced. Data related to labor are: Standard hours allowed 2 hours per unit Standard wages allowed $ 4.00 per hour

    Actual direct labor 230 hours for 897. (897/230 = 3.9)

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

    Direct labor rate variance = (4 - 3.9) * 230 = 23 favorable
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