Question

The direct labor efficiency variance could be the result of? Choose one and defend your answer.

		1. Quality of Raw Materials
		2. All of the other answers are correct
		3. Maintenance of Equipment
		4. Training of Employees

Answer 1

Answer:

2. All of the other answers are correct (i.e. Quality of raw material, maintenance of equipment and training of employees).

Explanation: The direct labour efficiency variance refers to the variance that arises due to the difference between the standard and actual time used to produced finished goods.

• Quality of raw material : If the quality of raw material is good then it becomes easier for the employees to produce the product from that raw material and also becomes easier to handle and they don't have to face any problem but if quality of raw material is poor then creates problem in producing the finished goods and also creates difficulty for the other dwpartments also due to which production cannot take place in standard time i.e. set by the department.
• Maintenance of Equipment :  The equipment have to be maintained from time to time . It plays a very vital role in reducing the risk associated with some workplace hazards and providing safer and healthier working conditions. Their service can be done at regular intervals so that there is no problem while manufacturing the finished product. If there is any breakdown in the machinery or any of the equipment while their work than it create the problem .
• Training of employees: Training of employees should be organized from time to time so that their skills and knowledge of the job and builds their confidence in their abilities. This will improve their performance and make them work more efficiently and effectively. It is also given so that they can cope up with the changes taking place rapidly. The employees are trained about use of equipments and work methods.