ACC 202 EXAM 3

Unfavorable labor rate variances may occur as a result of

-skilled workers being assigned to jobs requiring little skill -overtime premiums begin charged to the direct labor account

The labor efficiency variance is generally the responsibility of the _____ manager

Production manager

If managers consider it unwise to adjust the workforce in response to changes in workload ___

the direct labor workforce is really fixed in the short run

T/F A favorable labor rate variance is always favorable for a company

False

The labor rate variance measures the productivity of direct labor

False

T/F Excessive inventories contribute to inefficient operations

True

T/F How production supervisors use direct labor workers can lead to labor rate variances

True

T/F Overtime premiums can cause an unfavorable labor rate variance

True

T/F When the workforce is fixed, managers must be cautious about how labor efficiency variances are used

True

When the standard hours allowed are lower than the actual hours used, the labor efficiency variance is

Unfavorable

Poor supervision is one possible cause of an unfavorable _________ variance

labor efficiency

The difference between the actual hours used and the standard hours allowed for the actual output is used in the calculation of the

labor efficiency variance

When the workforce is fixed in the short term, labor efficiency variances

may need to be eliminated

When the workforce is fixed in the short term, labor efficiency variances need to be ____

monitored carefully