What was MAINE's standard direct labor rate in May? (M)
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.
2. MAINE INC.’s direct labor costs for the month of May are as follows:
Standard direct labor hours allowed 12,500
Actual direct labor rate P8.25
Actual direct labor hours 10,000
Direct labor rate variance – favorable P5,600
What was MAINE's standard direct labor rate in May? (M)
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