Question

Which of the following is a possible cause of an unfavorable labor rate variance?

1. hiring too many workers
2. hiring higher-quality workers at a higher wage
3. making too many units
4. purchasing too much material

When is the material quantity unfavorable?

1. when the actual quantity used is greater than the standard quantity
2. when the actual quantity used is less than the standard quantity
3. when the actual price paid is greater than the standard price
4. when the actual price is less than the standard price

This variance is the difference involving spending less or using less than the standard amount.

1. favorable variance
2. unfavorable variance
3. no variance
4. variance

Answer 1

Part 1)

The correct answer is

hiring higher-quality workers at a higher wage

Explaination

Higher quality workers are highered at high price which leads to unfavourable variace.

Part 2)

The correct answer is

when the actual quantity used is greater than the standard quantity

Explaination

Unfavourable effeciency variance is caused by using more than the standard qty.

Part 3)

The correct answer is

favourable variance

Explaination

Using less than the standard qty or spending less leads to favourable variance.