During January, 7,175 Direct Labor Hours Were Worked at a Standard

question 41

Multiple Choice

During January, 7,175 direct labor hours were worked at a standard cost of $20 per hour. If the direct labor rate variance for January was $17,500 favorable, the actual cost per direct labor hour must be

• A)$20.50.
• B)$25.50.
• C)$23.00.
• D)$17.56.

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Definitions:

Sales

The transactions involving the exchange of goods or services for money, constituting the primary revenue for most businesses.

Price Variance

The difference between the actual cost of a product or service and its standard or expected cost.

Price

The amount of money expected, required, or given in payment for something.

Fixed Budget Performance Reports

Financial reports comparing actual results to a plan that does not change, regardless of the level of activity.