Which of the following is the correct formula for measuring an efficiency variance?
A) Efficiency Variance = (Actual Quantity + Standard Quantity) - Standard Cost
B) Efficiency Variance = (Actual Quantity × Standard Quantity) / Standard Cost
C) Efficiency Variance = (Actual Quantity / Standard Quantity) × Standard Cost
D) Efficiency Variance = (Actual Quantity - Standard Quantity) × Standard Cost

Question

Quizplus · Accepted Answer

The correct formula for measuring an efficiency variance is (Actual Quantity - Standard Quantity) × Standard Cost. This formula calculates the difference between the actual quantity of inputs used and the standard quantity of inputs that should have been used, and then multiplies that difference by the standard cost per unit of input. Choice A, B, and C do not accurately represent the formula for measuring an efficiency variance.

Which of the Following Is the Correct Formula for Measuring