The rate and efficiency variances are subcomponents of

Question

Quizplus · Accepted Answer

The rate and efficiency variances are two subcomponents of a flexible-budget variance. The flexible-budget variance is the difference between the actual results and the flexible budget, where the flexible budget adjusts for changes in activity levels. The rate variance measures the difference between the actual cost and the budgeted cost per unit of input. The efficiency variance measures the difference between the actual input used and the budgeted input for the actual output achieved.

The Rate and Efficiency Variances Are Subcomponents of