What does a favourable labour rate variance indicate?
A) Actual hours exceed standard hours.
B) Standard hours exceed actual hours.
C) The actual rate exceeds the standard rate.
D) The standard rate exceeds the actual rate.

Question

Quizplus · Accepted Answer

A favourable labour rate variance occurs when the standard rate (what was expected to be paid per hour) exceeds the actual rate (what was actually paid per hour), indicating that the company paid less for labour than it had anticipated.

What Does a Favourable Labour Rate Variance Indicate