The labor rate variance for January is A 2025 U B 1827 U C 1

The labor rate variance for January is:

          A.

$2,025 U

          B.

$1,827 U

          C.

$1,827 F

          D.

$2,025 F

A.	$2,025 U
B.	$1,827 U
C.	$1,827 F
D.	$2,025 F

Direct materials. Direct labor. Variable overhead. Standard Quantity or Hours 6.5 kilos 0.3 hours 0.3 hours Standard Price or Rate $1.00 per kilo $10.00 per hour $4.00 per hour Standard Cost Per Unit $6.50 $3.00 $%1.20

Solution

Standard Rate 10 Standard Hours 2250 Actual rate (18473/2030) 9.1 Actual Hours 2030 Labour rate variance Actual Hours*(Standarad Rate - Actual Rate) Labour rate variance (Actual Hours*Standarad Rate) - (Actual Hours*Actual Rate) Labour rate variance (2030*10) - 18473 Labour rate variance (20300)-18473 Labour rate variance 1827 Labour rate variance 1827 Unfavourable Therefore, the right answer is option (b) 1827 U