Historic Restoration Company budgeted 33.0 hours of direct labor per unit at $14.75 per hour to produce 300 replica door knobs. The 300 knobs were completed using 1100. hours of direct labor at $13.75 per hour. What is the direct labor rate variance?
A)$1100 favorable
B)$9900 favorable
C)$1100 unfavorable
D)$9900 unfavorable

Question

Quizplus · Accepted Answer

The direct labor rate variance is calculated as (Actual Hourly Rate - Standard Hourly Rate) x Actual Hours Worked. Here, it is ($13.75 - $14.75) x 1100 = -$1.00 x 1100 = -$1100, which is favorable because the actual rate is less than the standard rate.

Historic Restoration Company Budgeted 33