If Variable Overhead Is Applied Based on Direct Labour Hours

question 4

Multiple Choice

If variable overhead is applied based on direct labour hours and there is an unfavourable labour efficiency variance,

• A)the materials usage variance will be unfavourable.
• B)the labour rate variance will be favourable.
• C)the variable overhead efficiency variance will be unfavourable.
• D)the variable overhead spending variance will be unfavourable.

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Definitions:

If-then Statement

A logical conditional statement stating that if one thing happens, then another will as well, expressing a causal or inferential relationship.

Asserted

Stated confidently or declared as true.

Disjunctive Syllogism

A logical rule that concludes one disjunct must be false if the other is true, usually in the form: Either A or B; not A; therefore, B.

Unstated Premise

A component of an argument that is not expressed but is assumed to be true for the argument to hold.