A Company Was Experiencing Slow Production Rates, and Lower Production

question 11

Multiple Choice

A company was experiencing slow production rates, and lower production volumes than demanded by management, so a new factory manager was hired. Upon investigation, she found that the workers were poorly motivated and not closely supervised. Midway through the quarter, she started an incentive program and paid out cash bonuses when workers hit their production targets. Within a short time, production output increased, but the bonuses had to be charged to the direct labor budget, and she was worried about the impact of these costs on operating income. This situation could have produced a(n) :

• A)unfavorable direct materials cost variance.
• B)unfavorable direct materials efficiency variance.
• C)favorable direct labor efficiency variance.
• D)favorable direct labor cost variance.

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Definitions:

Informed Consent

A formal acknowledgment by research subjects (respondents) that they understand the purpose of the research and agree to be studied.

U.S. Government

A system of governance in the United States that is defined by the Constitution and composed of three branches: the legislative, executive, and judicial branches, which function to create, enforce, and interpret laws, respectively.

American Sociological Association

A professional association for sociologists in the United States, dedicated to advancing sociology as a scientific discipline and profession.

Validity

The degree to which a research study accurately reflects or assesses the specific concept that the researcher is attempting to measure.