Giovanni Company produces a product that requires five standard hours per unit a

Question

Giovanni Company produces a product that requires five standard hours per unit at a standard hourly rate of $30 per hour. If 3,500 units required 17,700 hours at an hourly rate of $30.50 per hour, what is the direct labor (a) rate variance, (b) time variance, and (c) cost variance? Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

a. Direct labor rate variance $ SelectFavorableUnfavorableItem 2 b. Direct labor time variance $ SelectFavorableUnfavorableItem 4 c. Direct labor cost variance $ SelectFavorableUnfavorableItem 6

Explanation / Answer

Giovanni Company produces a product that requires five standard hours per unit at a standard hourly rate of $30 per hour. If 3,500 units required 17,700 hours at an hourly rate of $30.50 per hour, what is the direct labor (a) rate variance, (b) time variance, and (c) cost variance? Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

a. Direct labor rate variance $ 8850 Unfavorable
b. Direct labor time variance $ 6000 Unfavorable c. Direct labor cost variance $ 14850 Unfavorable

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