Direct Labor Variances

The following data relate to labor cost for production of 50,000 cellular telephones:

Actual: 9,300 hrs. at $29.50 Standard: 9,000 hrs. at $30.00

a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Line Item Description	Amount	Variance
Rate variance	$fill in the blank 1	FavorableUnfavorableFavorable
Time variance	$fill in the blank 3	FavorableUnfavorableUnfavorable
Total direct labor cost variance	$fill in the blank 5	FavorableUnfavorableUnfavorable

b. The employees may have been less-experienced or poorly trained, thereby resulting in a fill in the blank 1 of 3

higherlowerlower

labor rate than planned. The lower level of experience or training may have resulted in fill in the blank 2 of 3

lessmoreless

efficient performance. Thus, the actual time required was fill in the blank 3 of 3

lessmoremore

than standard.

The following data relate to labor cost for production of 50,000 cellular telephone Actual: 9,300 hrs. at $29.50 Standard: 9,000 hrs. at $30.00 a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a faverative number using a minus sign and an unfavorable variance as a positive number. experience or training may have resulted in efficient performance. Thus, the actual time required was Feedback Check My Work 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