Direct Labor Variances

Ada Clothes Company produced 14,000 units during April. The Cutting Department used 2,700 direct labor hours at an actual rate of $13.40 per hour. The Sewing Department used 4,500 direct labor hours at an actual rate of $13.10 per hour. Assume there were no work in process inventories in either department at the beginning or end of the month. The standard labor rate is $13.30. The standard labor time for the Cutting and Sewing departments is 0.2 hour and 0.3 hour per unit, respectively.

a. Determine the direct labor rate, direct labor time, and total direct labor cost variance for the (1) Cutting Department and (2) Sewing Department. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

	Cutting Department	Sewing Department
Direct Labor Rate Variance	$fill in the blank 1 FavorableUnfavorable	$fill in the blank 3 FavorableUnfavorable
Direct Labor Time Variance	$fill in the blank 5 FavorableUnfavorable	$fill in the blank 7 FavorableUnfavorable
Total Direct Labor Cost Variance	$fill in the blank 9 FavorableUnfavorable	$fill in the blank 11 FavorableUnfavorable

b. The two departments have opposite results. The Cutting Department has a(n)

favorableunfavorable

rate variance and a(n)

favorableunfavorable

time variance, resulting in a total

favorableunfavorable

cost variance. In contrast, the Sewing Department has a(n)

favorableunfavorable

rate variance but has a(n)

favorableunfavorable

time variance, resulting in a total

favorableunfavorable

cost variance.