The Efficiency Variance Measures ________

question 133

Multiple Choice

The efficiency variance measures ________.

• A) the difference between the quantity used by the company and the quantity used by its competitors
• B) the change in quantities used over time
• C) how well the business uses its materials or human resources
• D) how quickly direct materials are processed into finished goods

---

Definitions:

Times Interest Earned Ratio

A financial metric used to measure the company's ability to meet its debt obligations by comparing its income before interest and taxes to its interest expenses.

Interest Expense

The cost incurred by an entity for borrowed funds, typically reflected in income statements as a cost of financing operations.

Times Interest Earned Ratio

A financial ratio that measures a company's ability to meet its interest obligations based on its operating income.

Interest Expense

The cost incurred by an entity for borrowed funds, reflecting the price paid for using a lender's money or credit.