1) Albertville has a direct labor standard of 2 hours per unit of output. Each employee has a standard wage rate of $22.50 per hour. During July, Albertville paid $189,500 to employees for 8,890 hours worked. 4,700 units were produced during July. What is the direct labor rate variance?
2) Evaluate the following question and give a hypothetical example that will back up your answer.
When evaluating variances, is it best for managers and others to consider only one variance at a time? If so why, if not why not?