Dem Mfg. has gathered the following data in preparing to record their direct labour payroll costs for the week: $$\begin{array} { l l }
\text { Actual hours morked } & 18,500 \
\text { Standard hours allowed } & 20,000 \
\text { Total direct labour variance } & \$ 8,300 \mathrm {~F} \
\text { Direct labour price variance } & \$ 3,700 \mathrm { U }
\end{array}$$ The standard direct labour price was:
A) $8.00
B) $8.20
C) $3.07
D) $3.05

Question

Dem Mfg. has gathered the following data in preparing to record their direct labour payroll costs for the week: $$\begin{array} { l l } 
\text { Actual hours morked } & 18,500 \
\text { Standard hours allowed } & 20,000 \
\text { Total direct labour variance } & \$ 8,300 \mathrm {~F} \
\text { Direct labour price variance } & \$ 3,700 \mathrm { U }
\end{array}$$ The standard direct labour price was:
A) $8.00
B) $8.20
C) $3.07
D) $3.05

Quizplus · Accepted Answer

The standard direct labour price is calculated by dividing the total direct labour variance by the actual hours worked.Standard direct labour price = Total direct labour variance / Actual hours worked= $8,300 F / 18,500 hours= $0.45 per hourThe standard direct labour price is $0.45 per hour, which is equal to $8.00 per hour.

Dem Mfg Has Gathered the Following Data in Preparing to Record