The fixed manufacturing overhead budget variance equals:
A)Actual fixed manufacturing overhead cost - Applied fixed manufacturing overhead cost.
B)Actual fixed manufacturing overhead cost - Budgeted fixed manufacturing overhead cost.
C)Budgeted fixed manufacturing overhead cost - Applied fixed manufacturing overhead cost.
D)Actual fixed manufacturing overhead cost - (Actual hours × Standard fixed manufacturing overhead rate).

Question

Quizplus · Accepted Answer

The fixed manufacturing overhead budget variance measures the difference between actual fixed manufacturing overhead cost and budgeted fixed manufacturing overhead cost. So the correct formula for calculating it is Actual fixed manufacturing overhead cost − Budgeted fixed manufacturing overhead cost. Therefore, option B is the correct answer.

The Fixed Manufacturing Overhead Budget Variance Equals