All of the following are true except
A) A favorable labor efficiency variance could result from using higher quality materials that result in fewer inspections.
B) A favorable labor rate variance could result from lower wage workers quitting.
C) A favorable materials price variance could result from purchasing identical materials from another supplier at a lower price.
D) An unfavorable materials usage variance could result from not efficiently utilizing raw materials, thus causing waste.
E) An unfavorable labor efficiency variance can be caused by machine downtime, and poor quality materials.

Question

Quizplus · Accepted Answer

A favorable labor rate variance typically results from paying lower wages than planned, not from lower wage workers quitting. If lower wage workers quit, a company might have to hire new workers potentially at a higher wage, which could lead to an unfavorable labor rate variance, not a favorable one.

All of the Following Are True Except