A direct-labor efficiency variance cannot be caused by:
A) inexperienced employees.
B) poor quality raw materials.
C) employee inefficiency.
D) an out-of-date labor time standard.
E) producing fewer finished units than originally planned.

Question

Quizplus · Accepted Answer

A direct-labor efficiency variance is concerned with how effectively labor time is used in the production process, not the quantity of output produced. Choices A, B, C, and D all directly affect the efficiency of labor used, whereas producing fewer finished units than planned (choice E) relates more to production volume variance rather than labor efficiency.

A Direct-Labor Efficiency Variance Cannot Be Caused By