Answer :
Final answer:
A credit to DL Efficiency Variance shows that the production process was more efficient than expected, resulting in labor cost savings for the company. It signifies favorable workforce performance or cost management.
Explanation:
A credit to DL Efficiency Variance indicates that the direct labor used in the production process was more efficient than the standard or expected amount. In other words, workers took less time or the hourly wage was lower than planned, resulting in cost savings for the company. This variance is typically reported in a standard cost system within managerial accounting. A positive or credit balance in this context signifies better-than-expected workforce performance or cost management, which is a favorable outcome for the business.
