Knowee
Questions
Features
Study Tools

Given the following information, calculate the direct labor price variance.  Actual production in units17,000Standard labor cost per unit1/2 hour @ $20 per hourActual cost for labor$216,750 for 12,750 hoursMultiple choice question.$72,750 favorable$38,250 unfavorable$38,250 favorable$72,750 unfavorable

Question

Given the following information, calculate the direct labor price variance.  Actual production in units17,000Standard labor cost per unit1/2 hour @ 20perhourActualcostforlabor20 per hourActual cost for labor216,750 for 12,750 hoursMultiple choice question.72,750favorable72,750 favorable38,250 unfavorable38,250favorable38,250 favorable72,750 unfavorable

🧐 Not the exact question you are looking for?Go ask a question

Solution

To calculate the direct labor price variance, we need to follow these steps:

  1. Calculate the Actual Labor Cost per Hour: This is done by dividing the total actual cost for labor by the total actual hours worked. So, 216,750/12,750hours=216,750 / 12,750 hours = 17 per hour.

  2. Calculate the Standard Labor Cost per Hour: This is given in the problem as $20 per hour.

  3. Calculate the Actual Hours Worked: This is given in the problem as 12,750 hours.

  4. Calculate the Direct Labor Price Variance: This is done by subtracting the actual labor cost per hour from the standard labor cost per hour, and then multiplying the result by the actual hours worked. So, (20−20 - 17) * 12,750 hours = $38,250.

Since the actual labor cost per hour is less than the standard labor cost per hour, the variance is favorable.

So, the direct labor price variance is $38,250 favorable.

This problem has been solved

Similar Questions

Use the following data to find the direct labor rate variance if the company produced 3,500 units during the period. Direct labor standard (4 hours @ $12/hour) $ 48 per unitActual hours worked 12,250  Actual rate per hour $ 12.50  Multiple Choice$21,000 favorable.$6,125 unfavorable.$7,000 unfavorable.$14,875 favorable.$7,000 favorable.

Multiple Choice QuestionABC Company has set the following standards for one unit of product: Direct materials: 0.5 pounds @ $1.00 per pound; Direct labor: 1 hour @ $10.00 per hour. The company produced 35,000 units and had the following actual costs: Direct materials: 18,000 pounds at a total cost of $17,280; Direct labor: 36,000 hours at a total cost of $374,400. Compute the direct labor variance.Multiple choice question.$14,400 F$14,400 U$24,400 U$24,400 F

A job was budgeted to require 2 hours of labor per unit at $11.00 per hour. The job consisted of 8,500 units and was completed in 16,000 hours at a total labor cost of $189,100. What is the total direct labor variance?

XYZ Company makes one product and has calculated the following amounts for direct labor: AH x AR = $84,000; AH x SR = $83,000; SH x SR = $85,000. Compute the direct labor cost variance.Multiple choice question.$2,000 F$1,000 U$2,000 U$1,000 F

Given the following information, calculate the direct material efficiency variance.  Actual production in units17,000Standard cost for materials per unit$0.75 per pound × 3 poundsActual cost for materials$36,750 for 52,500 pounds Multiple choice question.$1,050 favorable$1,125 unfavorable$1,125 favorable$1,050 unfavorable

1/2

Upgrade your grade with Knowee

Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.