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Andy is a supervisor at a web design company. Andy has observed that most employees he supervises are more productive if he lets them have some freedom and flexibility in how they go about their work. Andy's experience is consistent with the teachings of scientific management.
Budget Variance
The difference between what was budgeted or planned in terms of financial performance or cost, and what was actually achieved.
Labor Efficiency Variance
The difference between the actual labor hours used and the standard hours expected for the level of production achieved.
Direct Labor
The cost of workers who are directly involved in the production of goods or the delivery of services.
Standard Cost System
An accounting method that assigns predetermined costs to products and services, which are then compared to actual costs to measure performance.
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