The standard cost card of a particular product specifies that it requires 4.5 direct labor-hours at $12.80 per direct labor-hour.During March,2,300 units of the product were produced and direct labor wages of $128,300 were incurred.A total of 11,700 direct labor-hours were worked.The direct labor variances for the month were:

Question

Quizplus · Accepted Answer

Labor rate variance = (AH × AR)- (AH × SR)
= $128,300 - (11,700 direct labor-hours × $12.80 per direct labor-hour)
= $128,300 - ($149,760)
= $21,460 F
Labor efficiency variance = (AH - SH)× SR
= [11,700 direct labor-hours - (2,300 units × 4.5 direct labor-hours per unit)] × $12.80 per direct labor-hour
= [11,700 direct labor-hours - (10,350 direct labor-hours)] × $12.80 per direct labor-hour
= [1,350 direct labor-hours] × $12.80 per direct labor-hour
= $17,280 U

The Standard Cost Card of a Particular Product Specifies That