Direct Labor Variances

Bellingham Company produces a product that requires $5$ standard direct labor hours per unit at a standard hourly rate of $$22\mathrm{.}00$ per hour. If $4,000$ units used $20,600$ hours at an hourly rate of $$21\mathrm{.}56$ per hour, what is the direct labor $($a$)$ rate variance, $($b$)$ time variance, and $($c$)$ cost variance? Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

a$.$ Direct labor rate variance

b$.$ Direct labor time variance

$

$$

$ $$

$$

$x$

c$.$ Direct labor cost variance

$

Favorable $x$

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Unfavorable variances can be thought of as increasing costs $($a debit$).$ Favorable variances can be thought of as decreasing costs $($a credit$).$

The labor cost variance is the difference between the actual and standard labor cost.