Inefficient usage of labor implies a(n)
A) unfavorable variable overhead efficiency variance and an unfavorable variable overhead spending variance.
B) favorable variable overhead efficiency variance.
C) unfavorable variable overhead spending variance.
D) favorable variable overhead spending variance.
E) unfavorable variable overhead efficiency variance.

Question

Quizplus · Accepted Answer

Inefficient usage of labor means that more labor hours were used than necessary to complete a task, resulting in a higher variable overhead cost. This leads to an unfavorable variable overhead efficiency variance because the actual amount of labor hours used exceeded the standard amount of labor hours allowed for the production of a unit.

Inefficient Usage of Labor Implies A(n)