A favourable labour efficiency variance is created when:

a.

actual labour hours worked exceed standard hours allowed

b.

actual hours worked are less than standard hours allowed

c.

actual wages paid are less than amounts that should have been paid

d.

actual units produced exceed budgeted production levels

e.

Some other statement not listed here.

2

If there is excess capacity, the minimum acceptable price for a special order must cover

a.

only variable costs associated with the special order

b.

Variable and fixed manufacturing costs

c.

variable costs and incremental fixed costs associated with the special order, plus the contribution margin usually earned on regular units

d.

Some other statement not listed here