A. The actual labor rate was less than the standard labor rate, which creates a favorable variance. See the correct answer for a complete explanation.
B. The labor rate variance is calculated as follows: (Actual Rate - Standard Rate) × Actual Hours (i.e., actual units of input). All the components of the formula are in the data given. The actual rate is $18, and the standard rate is $20. The actual hours are 78,000. Thus, the variance is ($18 - $20) × 78,000 = $(156,000). The direct labor rate variance for April is favorable because the actual labor rate was less than the standard labor rate.
C. This is the direct materials efficiency variance. However, the question asks for the direct labor rate variance. See the correct answer for a complete explanation.
D. The labor rate variance is calculated as follows: (Actual Rate - Standard Rate) × Actual Hours (i.e., actual units of input). An answer of $40,000 results from using the formula (Standard Rate - Actual Rate) × Actual Units of Output.
