Which formula represents the direct labor efficiency variance?

The direct labor efficiency variance measures how efficiently labor is used in the production process compared to what was planned. It highlights the difference between the actual hours worked and the standard hours that were expected for the actual level of production.

The correct formula for the direct labor efficiency variance is based on the standard rate of labor. By taking the standard rate and multiplying it by the difference between the actual hours worked and the standard hours allowed for the actual output, you can quantify the variance. This approach illustrates whether labor time was used more efficiently or inefficiently than anticipated. If actual hours exceed standard hours, the variance will reflect unfavorable efficiency; if actual hours are fewer than standard hours, it signals favorable efficiency.

The other options deal with different variations or cost assessments that do not pertain specifically to measuring labor efficiency relative to planned output, thus distinguishing the correct choice effectively.