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The accounting method that is used for stock appreciation rights (SARs) compensation plans is similar to the accounting procedures that can be used for
Labor Efficiency Variance
measures the difference between the actual hours worked to produce goods and the standard hours expected, multiplied by the standard labor rate.
Direct Labor-Hours
The hours worked by employees directly involved in the production process.
Variable Overhead Efficiency Variance
A metric that measures the difference between the actual hours taken to produce something and the expected (standard) hours, multiplied by the variable overhead rate per hour.
Standard Machine-Hours
The allocated number of operating hours expected for machinery to achieve a set level of production under standard conditions.
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