The-definition.com

Definition

Labor price variance

Labor price variance is the difference between the actual hours times the actual rate and the actual hours times the standard rate for labor.

The formula for the labor price variance is as follows.

(Actual Hours * Actual Rate) – (Actual Hours * Standard Rate) = Labor Price Variance (LPV)

Share it:  Cite

More from this Section

  • Margin of safety ratio
    The margin of safety ratio is the margin of safety in dollars divided by actual (or expected) ...
  • Capital expenditures
    Capital expenditures refer to the expenditures that increase the operating efficiency, ...
  • Gravestone Doji
    A Gravestone Doji is a candlestick formation generated by negative setbacks whenever the ...
  • Operational Audit
    Operational Audit is an extension of internal auditing to all the operations and the activities ...
  • Decentralization
    Decentralization means that the control of operations is delegated to many managers throughout ...