In a Company's Standard Costing System Direct Labor-Hours Are Used

question 135

Multiple Choice

In a company's standard costing system direct labor-hours are used as the base for applying variable manufacturing overhead costs. The standard direct labor rate is twice the variable overhead rate. Last period the labor efficiency variance was unfavorable. From this information one can conclude that last period the variable overhead efficiency variance was:

• A)unfavorable and half the labor efficiency variance.
• B)favorable and half the labor efficiency variance.
• C)unfavorable and twice the labor efficiency variance.
• D)favorable and twice the labor efficiency variance.

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Definitions:

Destination Country

The country to which goods, services, or people are being sent or migrating to.

Labor Migration

Labor migration is the movement of workers from one location to another, often between countries or regions, in search of better employment opportunities and living conditions.

Implicit Costs

The opportunity costs associated with a company's use of resources it owns, representing potential income lost.

Future Earnings

The expected profit or income generated by an investment, job, or business over a future period.