When the actual output is more than expected and the volume is unusually high then the production volume variance is
A)unfavourable and should be prorated to work-in-process inventory, finished goods inventory, and cost of goods sold.
B)unfavourable and should be charged to cost of goods sold.
C)favourable and should be offset against cost of goods sold.
D)unfavourable and should be applied to inventory.
E)favourable and should be applied to inventory.

Question

Quizplus · Accepted Answer

When actual output exceeds expectations with high volume, it indicates efficiency, leading to a favourable production volume variance, which can be applied to inventory.

When the Actual Output Is More Than Expected and the Volume