Calculate the direct labor rate variances


Problem 1: Each lamp manufactured at Bright Light uses a standard of 0.75 hours to produce. Production employees are paid a $9 hourly wage. The company incurred 5,000 direct labor hours at a cost of $47,500 to produce 6,700 lamps. Calculate the following variances and determine if it is considered favorable or unfavorable:

(A) Direct labor rate variance

(B) Direct labor time variance

(C) Direct labor cost variance

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Financial Accounting: Calculate the direct labor rate variances
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