To help managers in their efforts to control overhead costs,managers and accountants analyze overhead variances using the variable cost variance model by separating variable overhead variances into
A)price and quality components.
B)economy and efficiency components.
C)price and efficiency components.
D)economy and effectiveness components.

Question

Quizplus · Accepted Answer

The variable cost variance model separates variable overhead variances into two components: price and efficiency. Price variance is caused by changes in the price of variable overhead items, while efficiency variance is caused by changes in the quantity or usage of the variable overhead item. Economy and effectiveness components are not commonly used to analyze overhead variances. Quality is not a relevant component in analyzing variable overhead variances.

To Help Managers in Their Efforts to Control Overhead Costs,managers