The direct labor flexible budget variance is due to
A)what the company pays for labor and how efficiently employees work.
B)what the company pays for labor and how management allocates the labor rate.
C)how efficiently employees work and how management allocates the workers to products.
D)solely due to what the company pays for labor.

Question

Quizplus · Accepted Answer

The direct labor flexible budget variance arises from differences in what the company pays for labor (the labor rate variance) and how efficiently employees work (the labor efficiency variance). These two factors determine the total variance from the budgeted cost for a given level of production.

The Direct Labor Flexible Budget Variance Is Due to