Quality Brand Products Uses Standard Costing to Manage Their Direct

Multiple Choice

Quality Brand Products uses standard costing to manage their direct costs and their overhead costs. Overhead costs are allocated based on direct labor hours. In the first quarter, Quality Brand had an unfavorable price variance for their variable overhead costs. Which of the following scenarios would be a reasonable explanation for that variance?

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