Question
need B Direct labor variances Bellingham Company produces a product that requires 3 standard direct labor hours per unit at a standard hourly rate of
need B
Direct labor variances
Bellingham Company produces a product that requires 3 standard direct labor hours per unit at a standard hourly rate of $22.00 per hour. 15,100 units used 62,400 hours at an hourly rate of $19.75 per hour.
What is the direct labor (a)rate variance, (b)time variance, and (c)cost variance? Round your answers to the nearest dollar. 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 | $ -140,400 | Favorable Unfavorable Favorable |
b. Direct labor time variance | $ | Favorable Unfavorable Unfavorable |
c. Direct labor cost variance | $235,800 | Favorable Unfavorable Unfavorable |
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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.
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