The standard costs and actual costs for direct materials, direct labor, and factory overhead for the manufacture of 2,500 units of product are as follows: $\begin{array}{ll}
\text { StandardCosts } \
7,500 \text { hours } \$ 12 & \text { Directlabor } \
\
\text { Actual Costs } \
7,400 \text { hours } \$ 11.40 & \text { Direct labor }
\end{array}$
The amount of the direct labor time variance is:
A) $1,200 favorable.
B) $1,140 unfavorable.
C) $1,200 unfavorable.
D) $1,140 favorable.

Question

The standard costs and actual costs for direct materials, direct labor, and factory overhead for the manufacture of 2,500 units of product are as follows: $\begin{array}{ll}
\text { StandardCosts } \
7,500 \text { hours } \$ 12 & \text { Directlabor } \
\
\text { Actual Costs } \
7,400 \text { hours } \$ 11.40 & \text { Direct labor }
\end{array}$
 The amount of the direct labor time variance is:
A) $1,200 favorable.
B) $1,140 unfavorable.
C) $1,200 unfavorable.
D) $1,140 favorable.

Quizplus · Accepted Answer

The direct labor time variance is calculated as follows:Direct labor time variance = (Standard hours - Actual hours) x Standard rate= (7,500 hours - 7,400 hours) x $12= 100 hours x $12= $1,200 favorable

The Standard Costs and Actual Costs for Direct Materials, Direct