The following data for the Spring Green Garden Supplies Company pertains to the production of 5,000 shovels during March. Direct Labor Standard cost is 10 shovels per hour at $40 per hour Actual cost per labor hour was $42. Actual labor hours were 480. Actual Direct Labor quantity (or efficiency or usage) variance was $800 favorable What is the direct labor price/rate variance?
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Parrain 4 months ago
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Based on the standard and actual rates per hour, the direct labor price/rate variance for Spring Green Garden Supplies is $960 Unfavorable.

What is the direct labor price/ rate variance for Spring Green?

This can be found by the formula:

= (Standard labor rate per hour - Actual labor rate) x Number of hours worked

Solving gives:

= (40 - 42) x 480

= - 2 x  480

= -$960

In conclusion, the direct labor price variance is $960 Unfavorable.

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