Question

CGS @ Standard	1,000,000
Direct labor rate variance	120,000
Direct labor efficiency variance	(30,000)
Direct materials price variance	(50,000)
Direct materials quantity variance	(60,000)
Fixed overhead budget variance	(100,000)
Fixed overhead volume variance	(100,000)
Variable overhead spending variance	(10,000)
Variable overhead efficiency variance	80,000
Adjusted Cost of Goods Sold	850,000

Indicate which of the following is most consistent with the information above:

A. The firm used less of the variable overhead driver than they should have, given the amount they produced, and the actual variable overhead rate was lower than the predetermined overhead rate.

B. The firm used more of the variable overhead driver than they should have, given the amount they produced, and the actual variable overhead rate was lower than the predetermined overhead rate.

C. The firm used less of the variable overhead driver than they should have, given the amount they produced, and the actual variable overhead rate was greater than the predetermined overhead rate.

D. The firm used more of the variable overhead driver than they should have, given the amount they produced, and the actual variable overhead rate was greater than the predetermined overhead rate.