When fixed overhead spending variance is unfavorable, it can be safely assumed that ________.
A) flexible budget amount is higher than actual costs incurred
B) fixed overhead allocated for actual output is lower than actual costs incurred
C) flexible budget amount is lower than actual costs incurred
D) fixed overhead allocated for actual output is higher than actual costs incurred

Question

Quizplus · Accepted Answer

An unfavorable fixed overhead spending variance occurs when the actual fixed overhead costs exceed the budgeted (flexible budget) fixed overhead costs.

When Fixed Overhead Spending Variance Is Unfavorable, It Can Be