An actual input quantity is 200 units and the budgeted input quantity is 50 units, then the efficiency variance will be ___________?
Correct answer: C. 150 units
- A. 275 units
- B. 250 units
- C. 150 units
- D. 650 units
Explanation
The difference between actual input of 200 units and budgeted input of 50 units is 200 − 50 = 150 units, representing excess usage. Therefore, the efficiency variance is 150 units, normally described as adverse.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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