The Formula to Compute Direct Labor Rate Variance Is to Calculate

question 82

Multiple Choice

The formula to compute direct labor rate variance is to calculate the difference between

• A) actual costs + (actual hours * standard rate)
• B) actual costs - standard cost
• C) (actual hours * standard rate) - standard costs
• D) actual costs - (actual hours * standard rate)

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Definitions:

Uncollectible Accounts

Accounts receivable that are recognized as unlikely to be collected, leading to their write-off as bad debts.

Bad Debt Expense

An expense reported on the income statement, reflecting the cost of credit sales that are not expected to be collected.

Terms 2/10 N/30

A common payment term in business indicating that a buyer can take a 2% discount on the invoice price if payment is made within 10 days; otherwise, the full invoice price is due in 30 days.

Merchandise Returns

Goods returned by the buyer to the seller, often due to defects, dissatisfaction, or other reasons, leading to a reversal of the sale.