Question
The standard cost of labour for 1 unit is 2 hours at
₹50 per hour. Actual production is 100 units and actual labour cost is ₹11,000 for 200 hours. What is the labour rate variance?Solution
LRV = Actual hours × (Standard rate – Actual rate) = 200 × (50 – 11,000/200) = 200 × (50 – 55) = –₹1,000 = ₹1,000 Adverse
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