The actual cost of direct labor per hour is $16.00 and the standard cost of direct labor per hour is $15.50.The direct labor hours allowed per finished unit is 0.5 hour.During the current period,5,500 units of finished goods were produced using 3,000 direct labor hours.How much is the direct labor efficiency variance?

Question

Quizplus · Accepted Answer

A)
Labor efficiency variance = (Actual hours - Standard hours for actual units)× Standard rate
$3,875 U = (3,000 - (5,500 units × 0.5 Standard hrs))× $15.50

The Actual Cost of Direct Labor Per Hour Is $16