A favorable efficiency variance for direct materials might indicate that ________.
A) lower-quality materials were purchased
B) work is scheduled efficiently
C) there is an unexpected increase in direct labor rates
D) management hired underskilled workers

Question

Quizplus · Accepted Answer

A favorable efficiency variance for direct materials means that the amount of materials used is less than what was expected for the level of output achieved. This could be because work is scheduled efficiently, allowing workers to produce more output with fewer materials. The other answer choices (A, C, and D) would not lead to a favorable efficiency variance for direct materials.

A Favorable Efficiency Variance for Direct Materials Might Indicate That