Which of the following statements is true?

The variable overhead efficiency variance measures the difference between the actual level of activity and the standard activity allowed for the

actual output, multiplied by the fixed part of the predetermined overhead rate.

If demand is insufficient to keep everyone busy and workers are not laid off, an unfavorable $(U)$ variable overhead efficiency variance often will be

result unless managers build excessive inventories.

Neither statement is true.

Only statement$1$ is true.

Only statement $2$ is true.

Both statements are true.