The fixed overhead allocated for actual output unit is subtracted from budgeted fixed overhead to calculate _______________?
Correct answer: C. production volume variance
- A. budget variance
- B. price volume variance
- C. production volume variance
- D. cost volume variance
Explanation
Production volume variance compares budgeted fixed overhead with fixed overhead applied to the actual output level. Thus, budgeted fixed overhead minus fixed overhead allocated for actual output gives the production volume variance.
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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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More Cost Accounting questions
To calculate fixed overhead flexible budget variance, an actual incurred cost is subtracted from ___________?
In overhead cost variance analysis, the fixed overhead does not include ______________?
If the total setup cost is $35000 and fixed setup cost is $19000, then the variable fixed cost would be _____________?
In flexible budget analysis, the variable overhead flexible budget variance is equal to _________?
If the fixed setup cost is $21000 and the variable setup cost is $11000, then the setup cost would be _________?
In production volume variance, an acquiring fixed cost such as equipment and plant lease is known as ____________?