Which of the following elements is (are) needed in a straightforward calculation of the variable-overhead spending variance?
A)Variable overhead incurred during the period.
B)Budgeted variable overhead based on actual hours worked.
C)Standard variable overhead applied to production.
D)Both variable overhead incurred during the period and budgeted variable overhead based on actual
E)Both variable overhead incurred during the period and standard variable overhead applied to production.

Question

Quizplus · Accepted Answer

To calculate the variable-overhead spending variance, we need to compare the actual variable overhead incurred during the period with the budgeted variable overhead based on the actual hours worked. Therefore, we need to have both variable overhead incurred during the period (Option A) and budgeted variable overhead based on actual hours worked (Option B). We do not need the standard variable overhead applied to production (Option C) as it is used to calculate a different variance (i.e., variable-overhead efficiency variance).

Which of the Following Elements Is (Are) Needed in a Straightforward