Ernest Company makes and sells a single product. Last period the company's labor rate variance was $14,400 F. During the period, the company worked 36,000 actual direct labor-hours (DLH) at an actual cost of $338,400. The standard labor rate for the product in dollars per direct labor hour (DLH) is: Select one: a. $8.50/DLH b. $8.25/DLH c. $9.80/DLH d. $9.40/DLH e. $9.00/DLH
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Ernest Company makes and sells a single product. Last period the company's labor rate variance was $14,400 F. During the period, the company worked 36,000 actual direct labor-hours (DLH) at an actual cost of $338,400.
The standard labor rate for the product in dollars per direct labor hour (DLH) is:
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
