Montana Company Uses a Standard Costing System What Is the Total Labor Budget Variance for Montana Company

question 42

Multiple Choice

Montana Company uses a standard costing system. The following information pertains to direct labor costs for the month of February: $$\begin{array} { l l } \text { Standard direct labor rate per hour } & \$ 15.00 \\\text { Actual direct labor rate per hour } & \$ 13.50 \\\text { Labor rate variance } & \$ 18,000 \text { favorable } \\\text { Actual output } & 1,000 \text { units } \\\text { Standard hours all owed for actual production } & 10,000 \text { hours }\end{array}$$ What is the total labor budget variance for Montana Company?

• A)$18,000 (F)
• B)$12,000 (U)
• C)$18,000 (U)
• D)$12,000 (F)

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