A Favourable Labour Efficiency Variance Would Result in a Credit

question 203

True/False

A favourable labour efficiency variance would result in a credit balance in the labour efficiency variance account.

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Definitions:

Net Income

The sum of a company's income once all costs and taxes are subtracted from its total revenue.

Variable Expenses

Costs that vary in direct proportion to changes in the level of activity or volume of goods produced.

Fixed Expenses

Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance premiums, providing stability in financial planning.

Break-Even Point

The production level or sales volume at which total revenues equal total expenses, with no net profit or loss.