In flexible budget analysis, the variable overhead flexible budget variance is equal to _________?
Correct answer: B. actual cost-flexible budget amount
- A. fixed cost-variable budget amount
- B. actual cost-flexible budget amount
- C. variable cost-allocated amount
- D. actual cost-variable amountFinance
Explanation
The variable overhead flexible-budget variance isolates spending differences by comparing actual variable overhead with the flexible-budget amount allowed for the actual activity. Therefore, it is actual cost minus flexible-budget amount.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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