Question: At 4 0 , 0 0 0 direct labor hours, the flexible budget for indirect labor is $ 1 6 0 , 0 0 0

At 40,000 direct labor hours, the flexible budget for indirect labor is $160,000. If $172,000 of indirect labor costs are incurred at 44,000 direct labor hours, the flexible budget report should show the following difference for indirect labor.
At 40,000 direct labor hours, the flexible budget for indirect labor is $160,000. If $172,000 of indirect labor costs are incurred at 44,000 direct labor hours, the flexible budget report should show the following difference for indirect labor.
$12,000 favorable.
$4,000 unfavorable.
$4,000 favorable.
$12,000 unfavorable.

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