Dibert Inc. has provided the following data concerning one of the products in its standard cost system. The company has reported the following actual results for the product for February:
The labor rate variance for the month is closest to:
A) $5,746 U
B) $6,069 F
C) $5,746 F
D) $6,069 U

Question

Dibert Inc. has provided the following data concerning one of the products in its standard cost system.  The company has reported the following actual results for the product for February:
 The labor rate variance for the month is closest to:
A) $5,746 U 
B) $6,069 F 
C) $5,746 F 
D) $6,069 U

Quizplus · Accepted Answer

Labor rate variance = (AH × AR) − (AH × SR)
= $74,698 − (3,380 hours × $20.40 per hour)
= $74,698 − $68,952
= $5,746 U