EJB Company Used a "Normal" Production Level of 10,000 Units

question 78

Multiple Choice

EJB Company used a "normal" production level of 10,000 units to determine the standard per-unit cost of manufacturing overhead.Which of the following is not true?

• A)There is no overhead volume variance for a given month if actual production that month is 10,000 units.
• B)When actual production exceeds 10,000 units,use of standard costs results in a favorable overhead volume variance.
• C)When actual production is less than 10,000 units,use of standard costs results in an unfavorable total overhead variance.
• D)Overhead variances arising as a result of producing more or less than 10,000 units do not indicate either strong or poor performance by the Production Department.

---

Definitions:

Nondirectional Correlation

A type of correlation that measures the strength and direction of a relationship between two variables, without assuming which variable influences the other.

Unidirectional Correlation

A correlation where an increase in one variable is associated with an increase in another or a decrease in one is associated with a decrease in the other, without implying causation.

Negative Correlation

An association between two variables characterized by the increase of one and the decrease of the other.

Nondirectional Correlation

A type of correlation that indicates a statistical relationship between two variables without specifying whether the relationship is positive or negative.