Which of the following statements is true?

1.) To help assess how well a manager has controlled costs, actual costs should be compared to what the costs should have been for the actual level of activity.

2.) Fixed costs should be ignored when evaluating how well a manager has controlled costs.

A.) Only statement I is true.

B.) Only statement II is true.

C.) Both statements are true.

D.) Neither statement is true.

Which of the following statements is true?

1.) If activity is higher than expected, total fixed costs should be higher than expected. If activity is lower than expected, total fixed costs should be lower than expected.

2.) In a flexible budget, when the activity declines, the unit variable cost also declines.

A.) Only statement I is true.

B.) Only statement II is true.

C.) Both statements are true.

D.) Neither statement is true.

Which of the following statements is true?

1.) The labor efficiency variance is labeled favorable (F) if the actual hours used is less than the standard hours allowed for the actual output.

2.) If demand is insufficient to keep everyone busy and workers are not laid off, a favorable (F) labor efficiency variance often will be a result.

A.) Only statement I is true.

B.) Only statement II is true.

C.) Both statements are true.

D.) Neither statement is true.