After Comparing Performance Against Control Standards Managers Should Never Change

question 145

True/False

After comparing performance against control standards managers should never change the standard.

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Definitions:

Labour Efficiency Variance

A measure of the difference between the actual hours worked and the hours that should have been worked for the level of production achieved.

Overhead Spending Variance

The difference between the actual overhead expenses incurred and the overhead expenses budgeted or planned for a period.

Overhead Efficiency Variance

A metric used to assess the efficiency of overhead expenses in relation to the level of production or activity achieved.

Standard Costing

A costing method that assigns average costs to each production unit, based on estimated direct materials, labor, and overhead costs.