The Per-Unit Standards for Direct Labour Are 3 Direct Labour

question 75

Multiple Choice

The per-unit standards for direct labour are 3 direct labour hours at $15 per hour.If in producing 700 units, the actual direct labour cost was $31,175 for 2,150 direct labour hours worked, the total direct labour variance is

• A)$50 unfavourable.
• B)$325 favourable.
• C)$50 favourable.
• D)$325 unfavourable.

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Definitions:

Raw Materials Inventory

The stock of basic materials and components that are required in the manufacturing process before they are transformed into finished goods.

Purchase

The acquisition of goods or services in exchange for money, representing a transaction that increases inventory or assets for a business.

Process Costing System

An accounting method used to assign production costs to units of output, typically used in manufacturing environments where products are indistinguishable from one another.

Maintenance Workers

Individuals responsible for the upkeep, repair, and maintenance of buildings, equipment, and machinery to ensure efficient operations.