Asked by Jaydan MacMaster on May 27, 2024

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Compute the direct labor rate and time variances for Taylor Company.

Direct Labor Rate Variance

The difference between the expected cost of direct labor and the actual cost incurred, based on the rate paid per hour.

Direct Labor Time Variance

The difference between the actual time spent on production and the estimated standard time, multiplied by the standard labor rate.

  • Absorb the techniques for computing variances in direct labor rates and time.
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GS
Grace StephensonMay 29, 2024
Final Answer :
Direct labor rate variance: $62,928 - ($14.00 × 4,560) = $(912) favorable
Direct labor time variance: [4,560 - (980 × 4.5)] × $14.00 = $2,100 unfavorable