The direct labor rate variance arises when
A)actual wage rates differ from the standard wage rate.
B)actual hours worked differ from budgeted hours.
C)the number of units produced differs from those budgeted.
D)the total budgeted labor cost differs from the actual labor cost.

Question

Quizplus · Accepted Answer

The direct labor rate variance arises when the actual wage rates paid to employees differ from the standard wage rate that was set as part of the budget or standard cost. This variance is calculated by multiplying the difference between the actual and standard wage rates by the actual hours worked.

The Direct Labor Rate Variance Arises When