Question - Levram Company uses a standard costing system. During the past year, the following variances were calculated:
Direct labor rate variance - $23,000 Unfavorable
Direct labor efficiency variance - $43,500 Unfavorable
Variable overhead efficiency variance - $30,000 Unfavorable
According to Levram's standards, the standard variable overhead rate is $4 per direct labor hour.
During the past year, Levram used 15% more direct labor hours than should have been used given the standards.
Calculate the actual direct labor rate per hour paid by Levram Company during the past year. Enter your answer with two places after the decimal point (i.e., $9.70).