If the actual labour hours worked exceed the standard labour hours allowed, what type of variance will occur? A. Favorable labour rate variance. B. Favorable labour efficiency variance. C. Unfavourable labour rate variance D. Unfavourable labour efficiency variance Unfavourable material quantity variances A. mean that less indirect materials were used than expected for actual output. B. could be caused by normal spillage. C. mean that smaller quantity discounts were taken on purchases. D. mean that more direct materials were used than expected for actual output. Delmar Corporation is considering the use of residual income as a measure of the performance of its divisions. What major disadvantage of this method should the company consider before deciding to institute it? A) This method does not make allowance for difference in the size of compared divisions. B) Opportunities may be undertaken which will decrease the overall return on investment. C) The minimum required rate of return may eliminate desirable opportunities from consideration. Residual income does not measure how effectively the division manager controls costs. Suppose a manager is to be measured by residual income. Which of the following will not result in an increase in the residual income figure for this manager, assuming other factors remain constant? A) An increase in sales. B) An increase in the minimum required rate of return. C) A decrease in expenses. D) A decrease in operating assets