EBK AUDITING+ASSURANCE SERVICES
EBK AUDITING+ASSURANCE SERVICES
17th Edition
ISBN: 9780135171219
Author: ARENS
Publisher: PEARSON CO
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Chapter 3, Problem 2RQ
To determine

Explain the purpose of the opinion section in the auditor’s report and identify the most important information included in the opinion section.

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A company produced 2,200 units of output during a production process that normally requires 2 hours of labor per unit of output. The standard labor rate is $16 per hour, but the company paid $15 per hour. Actual hours needed to complete the production process were 4,600. How much was the labor efficiency variance? A. $3,000 favorable. B. $3,000 unfavorable. C. $3,200 favorable. D. $3,200 unfavorable.
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