The Flapjack Corporation had 8,200 actual direct labor hours at an actual rate of $12.40 per hour. Original

production had been budgeted for 1,100 units, but only 1,000 units were actually produced. Labor

standards were 7.6 hours per completed unit at a standard rate of $13.00 per hour.

Compute the labor time variance.:

a: 9,880F

b: 9,880U

c: 7,800U

d: 7,800F

Option (C) is correct.

Explanation:

Given that,

Actual direct labor hours = 8,200

Actual rate = $12.40 per hour

Original production = 1,100 units

Actual units produced = 1,000

Labor standards = 7.6 hours per completed unit

standard rate = $13.00 per hour

Labor time variance:

= (Standard hours - Actual hours) * Standard rate

= (1,000 * 7.6 - 8,200) * $13

= 7,800 Unfavorable