Cavalaris Products Uses a Standard Cost System

question 221

Multiple Choice

Cavalaris Products uses a standard cost system.Variable overhead costs are allocated based on direct labor hours.In the first quarter,Cavalaris had an unfavorable 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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Definitions:

Virtual Design

The process of creating digital models or simulations of physical objects, spaces, or systems for planning, visualization, or testing purposes.

Functional Design

A design approach focused on creating systems, processes, or products based on their intended function or purpose.

Product Design

The process of creating and developing a new product to be sold by a business to its customers, focusing on its features, appearance, and functionality.

Elementary Type

Basic or fundamental categories or classifications, often used in the context of general characteristics or primary distinctions.