Adler Industries Uses a Standard Cost System

question 154

Essay

Adler Industries uses a standard cost system.Adler has established the following standards for one unit of product: standard labor of .25 hour and standard wage rate of $12 per hour.During January, Adler used 5,000 hours of direct labor and paid $62,500 in wages in producing 18,700 units.
Required:
Calculate the direct labor rate variance and indicate whether the variance is favorable or unfavorable.