Question

claire company uses a standard costing system. the following information pertains to direct labor costs for february: line item description numerical data standard direct labor rate per hour $15.00 actual direct labor rate per hour $13.50 labor rate variance $18,000 f actual output 1,000 units standard hours allowed for actual production 10,000 hours what is the total labor variance for claire company?

Answer 1

The total labor variance for Claire Company includes both labor rate and labor efficiency variances. With a given favorable labor rate variance of $18,000 and without actual hours worked, we cannot calculate the labor efficiency variance or the total labor variance.

Step-by-step explanation:

The total labor variance for Claire Company is calculated by adding the labor rate variance to the labor efficiency variance. The labor rate variance has been given as $18,000 favorable (F), which means that the actual labor rate is less than the standard rate by $18,000. To find the labor efficiency variance, we need to compare the actual labor cost to the standard labor cost for the actual output.

The standard labor cost for the actual output is the standard hours allowed for actual production (10,000 hours) multiplied by the standard direct labor rate per hour ($15.00). The actual labor cost is the actual hours worked at the actual rate ($13.50 per hour). Since we do not have the data on actual hours worked, we cannot calculate the labor efficiency variance and therefore, the total labor variance cannot be determined with the given information.