standard labor hours per unit 4.5 hours standard labor rate $17 per hour actual hours worked...

standard labor hours per unit	4.5 hours
standard labor rate	$17 per hour
actual hours worked	2,000 hours
actual labor	$38,000
actual output	500 units

What is the labor efficiency variance?

		$4,250 favorable
		$1,500 unfavorable
		$4,250 unfavorable
		$1,500 favorable Which is correct?

Solutions

Expert Solution

Correct Answer is $ 4250 favourable
Labor efficiency variance = SR (SH - AH)
= $17 (2250-2000)
= $4250 favourable

Where ,SR is the standard labor rate per hour = $17
SH is the standard labor hours allowed for the product
500 units *4.5hour per unit = 2250 hours
& AH is the actual hours worked = 2000 hours

ekkarill92 answered 1 year ago

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