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4 July, 09:13

Jaxson Corporation has the following data related to direct labor costs for September: actual costs are 10,200 hours at $15.75 per hour and standard costs are 10,800 hours at $15.50 per hour. What is the direct labor time variance? a. $9,300 favorable b. $9,300 unfavorable c. $9,450 favorable d. $9,450 unfavorable

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  1. 4 July, 09:21
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    The direct labor time variance is calculated through the equation,

    DL time variance = (Sh - Ah) x Ac

    where Ah and Sh are the actual and standard number of hours and Ac is the actual cost. Substituting,

    DL time variance = (10,800 - 10,200) x $15.75 / h

    = $9450

    Since, the answer of the direct labor time variance is positive then, it is favorable. The answer is letter C.
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