The Sitting Duck Company uses budgeted activity as its denominator level. The company had the following variances for Year 2016:

Direct Materials Quantity Variance $10,000 U

DM Price Variance $12,000 F

Direct Labor Efficiency Variance $ 3,000 F

DL Rate Variance $18,000 F

Variable Overhead Efficiency Variance $9,000 U

Variable Overhead Rate Variance $5,000 U

Fixed Overhead Volume Variance $6,500 U

Fixed Overhead Budget Variance $2,000 F

U = Unfavorable F = Favorable

Answer A for True, B for False, and C if the answer cannot be determined from the information given.

1. The company paid more than the standard rate per hour for direct labor.

2. The company used more than the standard allowed for direct materials on the actual units produced.

3. Actual production was less than budgeted production.

4. The company paid more than the standard price for direct materials purchased.

5. The company may have used direct labor hours to apply overhead to units.