The flexible budget variance for variable overhead costs is composed of a(n)________ variance and a(n)________ variance.
A) efficiency; effective
B) spending; rate
C) quantity; efficiency
D) spending; efficiency

Question

Quizplus · Accepted Answer

The flexible budget variance for variable overhead costs is composed of a spending variance, which compares the actual cost to the budgeted cost for the actual level of activity, and an efficiency variance, which compares the actual quantity of the allocation base used to the expected amount of the allocation base for the actual level of activity.

The Flexible Budget Variance for Variable Overhead Costs Is Composed