For fixed overhead costs,the spending variance is ________ equal to the flexible-budget variance.
A) always
B) sometimes
C) never
D) indeterminate

Question

Quizplus · Accepted Answer

The spending variance is calculated by subtracting the actual fixed overhead costs from the budgeted fixed overhead costs. The flexible-budget variance is calculated by subtracting the flexed budget from the actual costs. Since the fixed overhead costs do not change in the flexed budget, the spending variance is always equal to the flexible-budget variance.

For Fixed Overhead Costs,the Spending Variance Is ________ Equal to the Flexible-Budget