The algebraic equation for the direct labor efficiency variance is
A)direct labor efficiency variance = AQ × (AP - SP).
B)direct labor efficiency variance = SQ × (AP - SP).
C)direct labor efficiency variance = SP × (AQ - SQ).
D)direct labor efficiency variance = AP × (AQ - SQ).

Question

Quizplus · Accepted Answer

The direct labor efficiency variance is calculated as the difference between the actual hours of direct labor utilized and the standard hours that should have been utilized, multiplied by the standard hourly rate. The equation for this variance is SP × (AQ - SQ).

The Algebraic Equation for the Direct Labor Efficiency Variance Is