Question

Heavy​ Products, Inc. developed standard costs for direct material and direct labor. In​ 2017, AII estimated the following standard costs for one of their major​ products, the 10minusgallon plastic container. Budgeted quantity Budgeted price Direct materials 0.7 pounds $ 60 per pound Direct labor 0.1 hours $ 20 per hour During​ June, Heavy Products produced and sold 16 comma 000 containers using 1 comma 100 pounds of direct materials at an average cost per pound of $ 65 and 11 comma 200 direct manufacturing laborminushours at an average wage of $ 20.75 per hour. The direct manufacturing labor price variance during June is​ ________. A. $ 5 comma 500 unfavorable B. $ 8 comma 400 favorable C. $ 600 comma 500 unfavorable D. $ 8 comma 400 unfavorable

Answer 1

The correct answer is D.

Step-by-step explanation:

Giving the following information:

In​ 2017, AII estimated the following standard costs for one of their major​ products, the 10-gallon plastic container. Budgeted quantity Budgeted price Direct labor 0.1 hours $ 20 per hour. During​ June, Heavy Products produced and sold 16,000 containers using 11,200 direct manufacturing labor hours at an average wage of $ 20.75 per hour.

Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity

Direct labor rate variance= (20 - 20.75)*11,200= $8,400 unfavorable