Direct Labor Variances

The following data relate to labor cost for production of 7,100 cellular telephones:

Actual:	4,780 hrs. at $15.70	$75,046
Standard:	4,700 hrs. at $16.00	$75,200

a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter all values as a positive number and then identify the variance (e.g. Favorable or Unfavorable) in the adjacent column.

Rate variance	$
Time variance	$
Total direct labor cost variance	$

b. The employees may have been less-experienced or poorly trained, thereby resulting in a labor rate than planned. The lower level of experience or training may have resulted in efficient performance. Thus, the actual time required was than standard.