Question

Use this information for Harry Company to answer the question that follow.

The following data are given for Harry Company:

Budgeted production	1,009 units
Actual production	940 units
Materials:
Standard price per ounce	$1.931
Standard ounces per completed unit	10
Actual ounces purchased and used in production	9,682
Actual price paid for materials	$19,848
Labor:
Standard hourly labor rate	$14.00 per hour
Standard hours allowed per completed unit	4.4
Actual labor hours worked	4,841
Actual total labor costs	$78,666
Overhead:
Actual and budgeted fixed overhead	$1,089,000
Standard variable overhead rate	$25.00 per standard labor hour
Actual variable overhead costs	$135,548

Overhead is applied on standard labor hours. (Round interim calculations to the nearest cent.)

The direct labor rate variance is

a. $10,892.25 unfavorable

b. $20,762.00 unfavorable

c. $10,892.25 favorable

d. $20,762.00 favorable

Answer 1