Variences

Sir there’s a mcq which is asking us about which formula will correctly calculate direct labour efficiency variance in spreadsheet?

Options are

– =(C9×C4)-B13
– =b13- (C9×C4)
– =(C9×C4)-(150,000×8)
-=(150000-(C9×6))×8

According to options i will include the values

C9= actual production 26000
C4= standard direct labour cost =48
B13=direct labour (150,000 hrs) actual cost=1221000

Direct labour standard costs

6 hours @ $8 per hr =48

Now sir option c is correct answer

But i selected D, what I don’t understand is sir while calculating efficiency, we decide how much the actual production should’ve been and how much it is, so we multiply actual produc units with standard hours and finding the difference with actual hours and whatever the difference is multiply it by standard rate per hr to get the initial variance

But here it’s multiplying actual production with standard labour cost which is 48= 6 hr ×$8 per hr which will provide us standard cost and that is $1248000 and then multiplies actual hours with standard rate per hr $8 to get $1200000, i don’t get this we already got the actual cost why are we multiplying it with total standard cost, we do that to find total direct labour variance, could you explain me this sir please