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29 December, 10:09

A job was budgeted to require 3 hours of labor per unit at $8.00 per hour. the job consisted of 8,000 units and was completed in 22,000 hours at a total labor cost of $198,000. what is the total labor cost variance?

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  1. 29 December, 11:09
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    The total labor cost of variance is the difference of the two presented costs. The actual cost of production is presented below,

    actual cost of production = $198,000

    The other cost can be calculated through the equation,

    cost of production = (3 hours/labor u) (($8/unit) (8,000) = $192,000

    Thus, the total labor cost variance is approximately $6,000.
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