An Unfavourable Direct Materials Efficiency Variance and a Favourable Direct

question 252

Multiple Choice

An unfavourable direct materials efficiency variance and a favourable direct materials price variance might indicate which of the following?

• A) Less expensive, inferior materials requiring more than the standard amount were used in production
• B) Less expensive, inferior materials requiring less than the standard amount were used in production
• C) More expensive, superior materials requiring more than the standard amount were used in production
• D) More expensive, superior materials requiring less than the standard amount were used in production

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Definitions:

T Test

A statistical test used to determine if there is a significant difference between the means of two groups which may be related in certain features.

One-tailed Test

A statistical test that determines the direction of a relationship between variables, assessing whether one mean is greater than or less than another.

Two-tailed Test

A statistical test that considers both directions of an effect or relationship, testing for the possibility of positive or negative differences.