ACCA MA · Chapter 5 · Question 2 of 10
In a month, a department worked 4,400 hours and produced output worth 4,620 standard hours. Budgeted hours were 4,800. What was the labour efficiency ratio?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) 105.0%
Explanation
Efficiency ratio = standard hours of output / actual hours worked x 100 = 4,620 / 4,400 x 100 = 105.0%. The capacity ratio would be 4,400 / 4,800 = 91.7%, and the production volume ratio 4,620 / 4,800 = 96.3%.
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