Direct Labor Yield Variance

Written by True Tamplin, BSc, CEPF®

Updated on January 05, 2023

Definition

Direct labor yield variance is the variance used to analyze the effect of changes in labor yield on labor cost. Direct labor yield variance can be computed as:

Formula

(Actual units of labor inputs used – allowed for actual outputs) x (Standard average price per unit of labor input).

About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website, view his author profile on Amazon, or check out his speaker profile on the CFA Institute website.