Suppose a Company's Variable Overhead Is Applied on the Basis

Multiple Choice

Suppose a company's variable overhead is applied on the basis of direct labour hours, and the company has an unfavourable direct labour efficiency variance. What is most likely to result?

A) The direct labour rate variance will be favourable.
B) The direct materials usage variance will be unfavourable.
C) The variable overhead spending variance will be unfavourable.
D) The variable overhead efficiency variance will be unfavourable.