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What is the importance of the topic direct labour variance?

This topic is highly useful and important for accounting students. If you wish to know about the topic in detail and get a thorough analysis then Direct Labour Variance Assignment Help is the best choice that you can make. Let us see the importance of this topic-

  • Direct labour variance represents the difference between the actual cost incurred in the production and the standard cost related to actual production.
  • Talking about direct labour variance there are two types of it. One is direct labour rate variance and the other one is direct labor efficiency variance.
  • The direct labour rate variance represents the difference between the standard cost and the actual cost which is paid to the workers for the number of hours for which they have actually worked.
  • Direct labour efficiency variance calculates the difference between standard labour hour (which should have been worked upon by the labour for producing the actual number of units) and the actual number of hours (which are worked when the labour hours are being calculated according to the standard rate).
  • Thus this concept helps in knowing the difference between standard yield and the actual yield of the labour involved in production process.
  • This concept helps in preparation of budget and in controlling labour costs, making efficient use of labour, determining wage rates and other necessary expenses.
  • Thus this concept is very important to understand for cost accounting students and it involves solving a lot of numerical questions. By seeking professional help you can clarify all your doubts easily.

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