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17 August, 11:35

ImpressMe Products embosses notebooks with school and corporate logos. Last year, the company's direct labor payroll totaled $352,100 for 50,300 direct labor hours. The standard wage rate is $6.75 per direct labor hour. Calculate ImpressMe's direct labor rate variance. (Round answer to 0 decimal places, e. g. 125. If variance is zero, select "Not Applicable" and enter 0 for the amounts.)

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  1. 17 August, 11:49
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    Direct labor rate variance = $12,575 unfavorable

    Explanation:

    Giving the following information:

    Last year, the company's direct labor payroll totaled $352,100 for 50,300 direct labor hours. The standard wage rate is $6.75 per direct labor hour.

    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 = 352,100/50,300 = $7 per hour

    Direct labor rate variance = (6.75 - 7) * 50,300

    Direct labor rate variance = $12,575 unfavorable
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