If Variable Overhead Is Applied on the Basis of Direct

Multiple Choice

If variable overhead is applied on the basis of direct labor-hours and the variable overhead rate variance is favorable, then:

A) actual variable overhead rate exceeded the standard rate.
B) standard variable overhead rate exceeded the actual rate.
C) actual direct labor-hours exceeded the standard direct labor-hours allowed for the actual output.
D) standard direct labor-hours allowed for the actual output exceeded the actual hours.