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

Question

Quizplus · Accepted Answer

The efficiency variance measures how well the business uses its materials or human resources. It compares the actual quantity of materials or time used to produce a product to the standard quantity or time that should have been used. It helps in identifying areas where there is a wastage of resources or where the efficiency of the production process can be improved.

The Efficiency Variance Measures ________