The formula to compute the direct labor rate variance is to calculate the difference between
A) Actual costs + (Actual hours × Standard rate)
B) Actual costs - Standard cost
C) (Actual hours × Standard rate)- Standard costs
D) Actual costs - (Actual hours × Standard rate)

Question

Quizplus · Accepted Answer

The formula for calculating direct labor rate variance is:
Actual Costs - (Actual Hours x Standard Rate)
This formula calculates the difference between the actual cost of labor and the expected cost, based on the standard rate for labor and the actual number of hours worked. Therefore, the correct choice is D.

The Formula to Compute the Direct Labor Rate Variance Is