How Is the Direct Labor Rate Variance Calculated

question 225

Multiple Choice

How is the direct labor rate variance calculated?

• A)The difference between the standard labor rate and the actual labor rate multiplied by the actual labor hours used
• B)The difference between the standard labor rate and the actual labor rate multiplied by the standard allowable hours
• C)The difference between the standard labor hours and the allowable labor hours
• D)The difference between the standard labor rate and the actual labor rate

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Definitions:

Variance

A statistical measure that represents the dispersion or spread of a set of data points within a dataset.

Standard Deviation

A measure that is used to quantify the amount of variation or dispersion of a set of data values from the mean.

Distribution

The way in which something is shared out among a group or spread over an area, or the arrangement of values of a variable showing their observed or theoretical frequency of occurrence.

Variance

A statistical measure of dispersion that shows how much values in a data set differ from the mean.