Direct Labor Variances

Bellingham Company produces a product that requires 4 standard direct labor hours per unit at a standard hourly rate of $12.00 per hour. If 2,700 units used 10,600 hours at an hourly rate of $12.36 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	$
c. Direct labor cost variance	$

Standard Product Cost

Sana Rosa Furniture Company manufactures designer home furniture. Sana Rosa uses a standard cost system. The direct labor, direct materials, and factory overhead standards for an unfinished dining room table are as follows:

Direct labor:	standard rate	$18.00 per hr.
	standard time per unit	3.5 hrs.
Direct materials (oak):	standard price	$15.00 per bd. ft.
	standard quantity	26 bd. ft.
Variable factory overhead:	standard rate	$4.20 per direct labor hr.
Fixed factory overhead:	standard rate	$1.80 per direct labor hr.

a. Determine the standard cost per dining room table. If required, round your answer to two decimal places. $ per table

b. A standard cost system provides Sana Rosa Furniture management a cost control tool using the principle of . Using this principle, cost deviations from standards can be investigated and corrected.