Hello, Following is a partially completed performance report for a recent week for direct labor in the binding department of a book publisher. Original budget Fixed budget Actual Budget variance Direct labor $5,880 $6,450 The original budget is based on the expectation that 10,080 books would be bound; the standard is 24 books per hour at a pay rate of $14 per hour. During the week, 10,680 books were actually bound. Employees worked 430 hours at an actual total cost of $6,450. Calculate the direct labor variance. ??? thanks.
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.
Hello,
Following is a partially completed performance report for a recent week for direct labor in the binding department of a book publisher.
| Original budget | Fixed budget | Actual | ||
| Direct labor | $5,880 | $6,450 |
The original budget is based on the expectation that 10,080 books would be bound; the standard is 24 books per hour at a pay rate of $14 per hour. During the week, 10,680 books were actually bound. Employees worked 430 hours at an actual total cost of $6,450.
Calculate the direct labor variance. ???
thanks.
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