Question

Vaughn has a standard of 2 hours of labor per unit, at 12 per hour. In producing 3400 units, Vaughn used 6400 hours of labor at a total cost of 78080. Vaughn's total labor variance is _______________.

Answer 1

Vaughn's total labor variance is $3,520.

Step-by-step explanation:

To calculate Vaughn's total labor variance, we need to determine the standard labor cost given the standard of 2 hours of labor per unit at $12 per hour. Then we can compare it to the actual labor cost.

1. Calculate the standard labor cost: 2 hours per unit * $12 per hour = $24 per unit.
2. Calculate the total standard labor cost for producing 3400 units: $24 per unit * 3400 units = $81,600.
3. Calculate the labor variance: Total standard labor cost - Actual labor cost = $81,600 - $78,080 = $3,520.

Therefore, Vaughn's total labor variance is $3,520.