ELM Corporation Introduced a New Automated Production Process That Has

question 126

Multiple Choice

ELM Corporation introduced a new automated production process that has reduced the amount of labor needed, but not affected the use of materials. The standard cost system has not been changed yet to reflect this new process. Assuming the machinery is functioning properly and that workers were properly trained in its use, which of the following variances is most likely to result?

• A) Favorable variable overhead spending variance
• B) Favorable direct labor efficiency variance
• C) Unfavorable direct labor efficiency variance
• D) Favorable direct materials price variance

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Definitions:

Neglect

Failure to meet a dependent’s basic needs.

Physical Abuse

Action taken deliberately to endanger another person, involving potential bodily injury.

Maternal Employment

The participation of mothers in the workforce, including their engagement in paid employment roles.

Cognitive Development

The process of growth and change in intellectual capabilities such as thinking, reasoning, and understanding across the lifespan.