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Total Direct Labor Cost Variance

[TOH-tuhl dih-REKT LAY-buhr kost VAYR-ee-uhns]

What is the definition of Total Direct Labor Cost Variance?
The difference between the actual labor costs incurred and the standard labor costs for the actual production achieved.
Using Total Direct Labor Cost Variance in an Example

In a manufacturing company, if the standard cost for labor is $15 per hour for producing 100 units and the actual cost incurred is $17 per hour to produce the same number of units, the total direct labor cost variance would be negative, indicating higher costs than planned.

Using Total Direct Labor Cost Variance in a sentence

The manager reviewed the total direct labor cost variance report to identify areas where production efficiency could be improved.

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