A masonry job budgeted $48,000 of labor for the completed scope but recorded $54,000 of actual labor. What is the labor cost variance?
- A$54,000 unfavorable
- B$12,000 unfavorable
- C$6,000 favorable
- $6,000 unfavorable
Why D is correct
The best answer is: $6,000 unfavorable. Actual labor cost of $54,000 minus the $48,000 labor budget equals a $6,000 unfavorable variance. The comparison must use the same completed scope; company-wide profit can conceal this job-level overrun. The other values result from using the wrong base, operation, percentage, or cash-flow treatment.