If Overhead Is Applied to Production Using Direct Labor Hours

question 20

Multiple Choice

If overhead is applied to production using direct labor hours and the direct labor efficiency variance is favorable, then the variable overhead efficiency variance is:

• A) favorable.
• B) unfavorable.
• C) either favorable or unfavorable.
• D) neither favorable nor unfavorable.

---

Definitions:

Maximize Rewards

A principle often found in social exchange theory, suggesting individuals seek to enter relationships that provide the greatest benefits with the least costs.

Minimize Costs

Refers to the process of reducing expenses or outlays in order to achieve financial efficiency or budgetary goals.

Population

Any well-defined group of people (or things) that researchers want to know something about.

Researchers

Individuals who conduct systematic investigations to establish facts or principles or to collect information on a subject.