A favorable direct labor efficiency variance and an unfavorable direct labor rat

Question

A favorable direct labor efficiency variance and an unfavorable direct labor rate variance might indicate which of the following? 0 A. O B. O C. Skilled workers using more actual hours than standard, paid at a higher rate per hour than the standard rate Unskilled workers using less actual hours than standard, paid a lesser rate per hour than the standard rate Unskilled workers using more actual hours than standard, paid at a higher rate per hour than the standard rate D. Skilled workers using less actual hours than standard, paid at a higher rate per hour than the standard rate

Explanation / Answer

Labour efficiency variance is favorable means skilled labour actual hour is less than standard hour and labour rate variance is unfavorable means actual rate is higher than standard rate

so answer is d) Skilled workers using less actual hours than standard, paid at a higher rate per hour than the standard rate

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