DATA INPUT
Standard Standard
Direct-Labor Direct-Labor Hours
Rate per Hour Allowed, Given April Output
Labor Class III 24.00$ 1,000
Labor Class II 21.00 1,000
Labor Class I 15.00 1,000
Actual Actual
Direct-Labor Direct-Labor
Rate per Hour Hours
Labor Class III 25.80$ 1,100
Labor Class II 22.50 1,300
Labor Class I 16.20 750
SOLUTION
1) Variances (U denotes unfavorable; F denotes favorable):
a) Direct-labor rate variance for each labor class:
Actual Standard Difference Actual Rate
Labor Class Rate Rate in Rates Hours Variance
III 25.80$ 24.00$ 1.80$ 1,100 1,980$ U
b) Direct-labor efficiency variance for each labor class:
Actual Standard Difference Standard Efficiency
Labor Class Hours Hours * in Hours Rate Variance