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John is just hired by a software company as a programmer.He is also a part-time student at the local college and needs just a few credits to graduate from this college.A college degree is required in order to work as a programmer in this software company.Therefore,John receives below-minimum pay rate until he graduates from college.Which type of pay rate does John receive?
Standard Labour Rate
The predetermined cost per hour of labor, used in budgeting and costing to estimate the labor costs associated with a product.
Labour Efficiency Variance
Labour efficiency variance is the difference between the actual labor hours used and the standard labor hours expected for the output level achieved, reflecting labor efficiency.
Variable Overhead Efficiency Variance
The difference between the actual variable overhead incurred and the expected (or budgeted) variable overhead based on efficient usage of resources.
Material Price Variance
The difference between the actual cost of materials purchased and the expected (or standard) cost, indicating how efficiently materials are being purchased.
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