Labour Efficiency Calculation

[speed_demon]

Direct labour efficiency variance = (actual time - standard time) x standard cost

So in your example it is R750 unfavourable.

I'm not sure what "engineer count" means

It refers to the number of employees. So the Actual Engineers employed was 108. Standard was 114.

[CLIVE-TRIANGLE]

It refers to the number of employees. So the Actual Engineers employed was 108. Standard was 114.

Oh ok. The more accurate formula, that takes account of any stratification, is (Actual Time x Standard Rate) - (Standard Time X Standard Rate)
So, if I understand the data correctly, it is:
(18 x 108 x 750) - (17 x 114 x 750) = 4,500 unfavourable

Actual rate is ignored because it is an efficiency variance that is being determined.

[Houses4Rent]

Oh ok. The more accurate formula, that takes account of any stratification, is (Actual Time x Standard Rate) - (Standard Time X Standard Rate)
So, if I understand the data correctly, it is:
(18 x 108 x 750) - (17 x 114 x 750) = 4,500 unfavourable
Actual rate is ignored because it is an efficiency variance that is being determined.

Clive, you missed the R850 and you need to turn it around, i.e.
(17 x 114 x 750) - (18 x 108 x 850)

[speed_demon]

Oh ok. The more accurate formula, that takes account of any stratification, is (Actual Time x Standard Rate) - (Standard Time X Standard Rate)
So, if I understand the data correctly, it is:
(18 x 108 x 750) - (17 x 114 x 750) = 4,500 unfavourable

Actual rate is ignored because it is an efficiency variance that is being determined.

This is my logic too. My main issue was how to incorporate the change in employee counts.