Dillon Has a Standard of 2 Hours of Labor Per

question 51

Multiple Choice

Dillon has a standard of 2 hours of labor per unit at $12 per hour. In producing 2000 units Dillon used 3850 hours of labor at a total cost of $46970. Dillon's labor quantity variance is

• A) $770 U.
• B) $770 F.
• C) $1800 F.
• D) $1930 F.

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Definitions:

Raw Material

Basic materials or substances used in the manufacturing or production process to create goods and products.

Work in Process

Inventory that includes all the materials, labor, and overhead costs for products that are in the production process but not yet completed.

Property, Plant, and Equipment

Tangible long-term assets used in the operation of a business, such as buildings, machinery, and equipment.

Standard Costs

The estimated costs of materials, labor, and overhead allocated to produce a product or perform a service under normal conditions.