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6 March, 01:27

The following labor standards have been established for a particular product:Standard labor-hours per unit of output 9.0hoursStandard labor rate$15.10per hour The following data pertain to operations concerning the product for the last month: Actual hours worked 8100 hoursActual total labor cost$191,880 Actual output 800units What is the labor rate variance for the month

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  1. 6 March, 01:51
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    Direct labor rate variance = $69,579 unfavorable

    Explanation:

    Giving the following information:

    Standard labor-hours per unit of output 9.0 hours

    Standard labor rate = $15.10 per hour

    Actual hours worked = 8,100 hours

    Actual total labor cost = $191,880

    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 = 191,880/8,100 = $23.69 per hour

    Direct labor rate variance = (15.10 - 23.69) * 8,100

    Direct labor rate variance = $69,579 unfavorable
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