Labour Efficiency Variance (LEV) measures the difference between the standard hours allowed for actual production and the actual hours worked, multiplied by the standard labour rate. It indicates how efficiently labour time was used in production.
đ Formula:
Labour Efficiency Variance=(Standard Hours AllowedâActual Hours Worked)ĂStandard Labour Ratetext{Labour Efficiency Variance} = (text{Standard Hours Allowed} – text{Actual Hours Worked}) times text{Standard Labour Rate}