Question

Jaxson Corporation has the following data related to direct labor costs for September: actual costs are 10,200 hours at $15.75 per hour and standard costs are 10,800 hours at $15.50 per hour. What is the direct labor time variance?

Answer 1

Answer:

Direct labor time (efficiency) variance= $9,300 favorable

Explanation:

Giving the following information:

actual costs are 10,200 hours at $15.75 per hour.

standard costs are 10,800 hours at $15.50 per hour.

To calculate the direct labor time (efficiency) variance, we need to use the following formula:

Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate

Direct labor time (efficiency) variance= (10,800 - 10,200)*15.5

Direct labor time (efficiency) variance= $9,300 favorable