If the employees who build the product go on strike and temporary workers who are slower and not as skilled are hired, which variance is directly impacted?

Question

Quizplus · Accepted Answer

Labour efficiency variance is directly impacted when temporary workers with lower skills and slower work pace are hired, as the productivity of the labor force is reduced. This will lead to a decrease in the standard output and an increase in the actual input used, resulting in a negative labour efficiency variance. The other variances, such as materials price, materials efficiency, and labour price, are not affected by the labor force's productivity or skill level but rather are influenced by external factors such as pricing changes or wage rate fluctuations.

If the Employees Who Build the Product Go on Strike