The variancemost useful in evaluating plant utilization is the
A)variable overhead spending variance.
B)fixed overhead spending variance.
C)variable overhead efficiency variance.
D)fixed overhead volume variance.

Question

Quizplus · Accepted Answer

The fixed overhead volume variance is the most useful variance in evaluating plant utilization because it measures the difference between the actual fixed overhead applied to a product and the budgeted fixed overhead for the number of units produced. This variance provides insight into whether a plant is operating at full capacity or not, and can help managers make decisions about increasing or decreasing production levels to optimize plant utilization.

The Variancemost Useful in Evaluating Plant Utilization Is the