[amp_mcq option1=”Budgeted cost of labour” option2=”Estimated cost of labour” option3=”Actual cost of labour” option4=”None of these” correct=”option3″]<\/p>\n
The correct answer is: C. Actual cost of labour.<\/p>\n
Labour cost variance is the difference between the standard cost of labor and the actual cost of labor. The standard cost of labor is the amount of labor that should be used to produce a product, multiplied by the standard wage rate. The actual cost of labor is the amount of labor that was actually used to produce a product, multiplied by the actual wage rate.<\/p>\n
The labour cost variance can be used to identify areas where costs are out of control. If the variance is negative, it means that the actual cost of labor was higher than the standard cost of labor. This could be due to factors such as overtime, absenteeism, or inefficient work methods. If the variance is positive, it means that the actual cost of labor was lower than the standard cost of labor. This could be due to factors such as favorable productivity rates or lower wage rates.<\/p>\n
The labour cost variance can be used to improve efficiency and control costs. By identifying areas where costs are out of control, managers can take steps to improve productivity, reduce absenteeism, or implement more efficient work methods.<\/p>\n","protected":false},"excerpt":{"rendered":"
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