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Tennis Pro's standard assembly time per tennis racket is 0.40 hours at a standard cost of $10 per labor hour. During January 2010, Tennis Pro produced 5,000 tennis rackets in 2,300 labor hours at a cost of $9.50 per labor hour. Tennis Pro had budgeted to produce 4,800 tennis rackets in January 2010.
-What is Tennis Pro's labor rate variance?

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Tennis Pro's standard assembly time per tennis racket is 0.40 hours at a standard cost of $10 per labor hour. During January 2010, Tennis Pro produced 5,000 tennis rackets in 2,300 labor hours at a cost of $9.50 per labor hour. Tennis Pro had budgeted to produce 4,800 tennis rackets in January 2010.
-What is Tennis Pro's labor rate variance?

Quizplus · Accepted Answer

The labor rate variance is calculated as (Actual Rate - Standard Rate) x Actual Hours. Here, it is ($9.50 - $10.00) x 2,300 = -$0.50 x 2,300 = $1,150 favorable.

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