A consulting firm has a standard time of 4 hours per project. During a quarter it completed 20 projects and spent a total of 85 hours. Calculate the labor time variance and state whether it is favourable or unfavourable.

Step-by-step solution

1. Calculate the standard time for 20 projects: $20\times 4=80$ hours – the planned time.
2. Record the actual time spent: 85 hours.
3. Find the variance: $85-80=5$ hours.
4. Because actual time exceeds standard time, the variance is **unfavourable** – it cost more labour hours than planned.
5. State the result as 5 hours unfavourable.

Concept tested: Labor time variance

Published 16 October 2026 · How this solution was prepared and checked