Reference: 21_05 A Job Was Budgeted to Require Three Hours of Labor

question 91

Multiple Choice

Reference: 21_05
A job was budgeted to require three hours of labor per unit at $8 per hour. The job consisted of 8,000 units and was completed in 22,000 hours at a total labor cost of $198,000.
-What is the labor rate variance?

• A) $22,000 unfavorable
• B) $16,000 unfavorable
• C) $6,000 unfavorable
• D) $16,000 favorable
• E) $22,000 favorable

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Definitions:

Existence

The fact or state of living or having objective reality.

Initialization

The process of assigning an initial value to a variable at the time of its creation.

Static Variables

Variables that retain their value between function calls and are local to the function block in which they are declared but their lifespan is the duration of the program.

Automatic Variables

Variables that are automatically allocated on the stack and are local to the function block in which they are declared.