In variance analysis, fixed manufacturing overhead will have
A)an efficiency variance.
B)a flexible-budget variance.
C)a rate variance.
D)a static-budget variance.
E)no variance, because it is fixed.

Question

Quizplus · Accepted Answer

Fixed manufacturing overhead will not have any variance because it is fixed and does not vary with changes in production volume or activity level. Therefore, it cannot have an efficiency variance, flexible-budget variance, or rate variance. The static-budget variance is also irrelevant for fixed overhead as it does not change with the actual level of activity.

In Variance Analysis, Fixed Manufacturing Overhead Will Have