The formula to compute the direct labor rate variance is to calculate the differ

Question

The formula to compute the direct labor rate variance is to calculate the difference between Actual costs + (Actual hours x Standard rate) Actual costs - Standard cost (Actual hours x Standard rate) - Standard costs Actual costs - (Actual hours x Standard rate) The formula to the compute direct labor time variance is to calculate the difference between Actual costs - Standard costs Actual costs + Standard costs (Actual hours x Standard rate) - Standard costs Actual costs - (Actual hours x Standard rate) The standard costs and actual costs for factory overhead for the manufacture of 2,500 units of actual production are as follows: Fixed overhead (based on 10,000 hours) Variable overhead Total variable cost, $18,000 Total fixed cost, $8,000 3 hours per unit @ $0.80 per hour 3 hours per unit @ $2.00 per hour The amount of the fixed factory overhead volume variance is $2,000 favorable $2,000 unfavorable $2,500 unfavorable $0

Explanation / Answer

Solution.

11.

Calculation for direct labor rate variance.

D. Actual cost + ( Actual hour x standerd rate )

12.

C. (Actual hourt x Standard rate) - Standard cost

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