An Unfavorable Labor Quantity Variance May Be Caused by

question 117

Multiple Choice

An unfavorable labor quantity variance may be caused by

• A) paying workers higher wages than expected.
• B) misallocation of workers.
• C) worker fatigue or carelessness.
• D) higher pay rates mandated by union contracts.

---

Definitions:

Incremental Costs

Expenses that will be incurred only as a result of undertaking a specific action.

GAAP

Generally Accepted Accounting Principles; a common set of accounting principles, standards, and procedures that companies must follow when they compile their financial statements.

Erosion Cost

Costs that occur when the introduction of a new project reduces sales and profits of existing products.

Depreciation Expense

The allocation of an asset's cost over its useful life, reflecting the decrease in value of tangible assets.