Which of the following statements about the standard variable factory overhead application rate is true?

Multiple Choice

• The rate is a function of the denominator volume chosen.

• The rate is used for cost-control, but not product-costing purposes.

• The rate is used for product-costing, but not cost-control purposes.

• The same rate is used for product-costing and cost-control purposes.

• Generally speaking, the rate will be independent of the allocation base chosen to apply overhead.