Claire Company Uses a Standard Costing System - What Is the Total Labour Budget Variance for Claire

Multiple Choice

Claire Company uses a standard costing system.The following information pertains to direct labour costs for the month of February: $\begin{array}{ll}\text { Standard direct labour rate per hour } & \$ 15.00 \\\text { Actual direct labour rate per hour } & \$ 13.50 \\\text { Labour rate variance } & \$ 18,000 \text { favourable } \\\text { Actual output } & 1,000 \text { units } \\\text { Standard hours allowed for actual production } & 10,000 \text { hours }\end{array}$
- What is the total labour budget variance for Claire Company?

A) $12,000 (F)
B) $12,000 (U)
C) $18,000 (F)
D) $18,000 (U)