Direct labor variances

The following data relate to labor cost for production of $6,200$ cellular telephones:

Actual: $4,180$ hrs$.$ at $$13\mathrm{.}50$

Standard: $4,110$ hrs$,$ at $$13\mathrm{.}70$

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.

Rate variance

Time variance

Total direct labor cost variance

b$.$ The employees may have been less$-$experienced or poorly trained, thereby resulting in a

$$ efficient performance. Thus, the actual time required was

lower level of experience or training may have resulted in

$$ than standard.

Feedback

T 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.

Consider factors affecting labor performance.