When machine-hours are used as an overhead cost-allocation base, the most likely cause of a favorable variable overhead spending variance is ________.
A) excessive machine breakdowns
B) the production scheduler efficiently scheduled jobs
C) a decline in the cost of energy
D) strengthened demand for the product

Question

Quizplus · Accepted Answer

A favorable variable overhead spending variance occurs when the actual costs are less than the expected costs. A decline in the cost of energy would directly reduce the cost of running machinery, leading to a favorable variance.

When Machine-Hours Are Used as an Overhead Cost-Allocation Base, the Most