Trull Company Uses a Standard Cost System

question 7

Multiple Choice

Trull Company uses a standard cost system.Variable overhead costs are allocated based on direct labor hours.In the first quarter,Trull had a favorable cost variance for variable overhead costs.Which of the following scenarios is a reasonable explanation for this variance?

• A) The actual number of direct labor hours was lower than the budgeted hours.
• B) The actual variable overhead costs were higher than the budgeted costs.
• C) The actual variable overhead costs were lower than the budgeted costs.
• D) The actual number of direct labor hours was higher than the budgeted hours.

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