If Ferg Company Has a $12,000 Unfavourable Variable Overhead Efficiency

question 130

Multiple Choice

If Ferg Company has a $12,000 unfavourable variable overhead efficiency variance, which of the following statements would be TRUE?

• A)Ferg would credit the Cost of Goods Sold account to write-off the variance.
• B)Ferg used the variable overhead components more effectively than expected.
• C)Ferg made efficient use of the cost driver.
• D)Ferg used the variable overhead components and cost driver as expected.
• E)Ferg did not use the cost driver efficiently.

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Definitions:

FSH

Follicle-Stimulating Hormone, a hormone involved in the reproductive processes of both males and females, including the maturation of ovarian follicles and sperm production.

Pituitary

A small gland at the base of the brain responsible for regulating vital body functions and general wellbeing through hormone secretion.

Insulin

A hormone produced by the pancreas that regulates the amount of glucose in the blood.

Pancreas

An organ in the abdominal cavity involved in digestion and blood sugar regulation, producing digestive enzymes and insulin.