Suppose the Actual Labour Rate Exceeds the Standard Labour Rate

question 32

Multiple Choice

Suppose the actual labour rate exceeds the standard labour rate, and the actual labour hours exceed the number of hours allowed. What would be the labour rate variance and labour efficiency variance? Labour Rate Labour Efficiency
Variance Variance

• A) favourable favourable
• B) favourable unfavourable
• C) unfavourable favourable
• D) unfavourable unfavourable

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Definitions:

Long-Term Assets

Assets that are expected to provide economic benefits over a period longer than one year, such as buildings and equipment.

Strategic Plan

A document that outlines an organization's long-term goals and the actions needed to achieve them, often focusing on overall organizational growth and success.

Short-Term Plan

A strategy or agenda set for a brief period, typically less than a year, focusing on immediate goals and objectives.

Manufacturing Overhead

Indirect costs associated with manufacturing, such as utilities, maintenance, and salaried personnel expenses, which are not directly traceable to a specific product.