If an efficiency variance is 200 units and the actual input quantity is 750 units, then the budgeted input quantity will be ___________?
Correct answer: C. 550 units
- A. 275 units
- B. 125 units
- C. 550 units
- D. 650 units
Explanation
When actual input exceeds the budgeted input by 200 units, the budgeted quantity is 750 minus 200, or 550 units. This represents an unfavorable efficiency difference.
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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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