Smithville Uses Labour Hours to Apply Variable Overhead to Production

question 31

Multiple Choice

Smithville uses labour hours to apply variable overhead to production. If the company's workers were very inefficient during the period, which of the following statements would be true about the variable-overhead efficiency variance?

• A)The variance would be favourable.
• B)The variance would be unfavourable.
• C)The nature of the variance (favourable or unfavourable) would be unknown based on the facts presented.
• D)The variance would be the same amount as the labour efficiency variance.
• E)The variance would be the same amount as the fixed overhead volume variance.

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Definitions:

Unity

The state of being united or joined as a whole, especially among members of a group or team, resulting in a sense of solidarity and shared purpose.

Loss of Individuality

The process by which individuals lose their unique identity and assimilate into a group, often leading to a conformity or loss of personal expression.

Social Loafing

The phenomenon where individuals exert less effort to achieve a goal when they work in a group compared to when they work alone.

Role Ambiguity

Occurs when an individual lacks clear direction or information about their responsibilities and expectations in their role.