Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or HoursStandard Price or RateStandard Cost Per UnitDirect materials 5.7?ounces$2.00?per ounce$11.40?Direct labor 0.2?hours$11.00?per hour$2.20?Variable overhead 0.2?hours$6.00?per hour$1.20?The company reported the following results concerning this product in June. Originally budgeted output 3900?unitsActual output 3500?unitsRaw materials used in production 22,500?ouncesPurchases of raw materials 21,800?ouncesActual direct labor-hours 530?hoursActual cost of raw materials purchases$42,600? Actual direct labor cost$13,900? Actual variable overhead cost$3950? The company applies variable overhead on the basis of direct labor-hours. The direct
materials purchases variance is computed when the materials are purchased.The labor rate variance for June is:
A. $8070 U
B. $1779.96 F
C. $1779.96 U
D. $8070 F
Answer: A
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