(Appendix 11A)A volume variance is computed for:
A)both variable and fixed manufacturing overhead.
B)variable manufacturing overhead only.
C)fixed manufacturing overhead only.
D)direct labor costs as well as overhead costs.

Question

Quizplus · Accepted Answer

A volume variance measures the difference in fixed overhead costs incurred compared to the fixed overhead costs that would have been incurred if the actual level of activity matched the expected level of activity. Therefore, it only applies to fixed manufacturing overhead costs.

(Appendix 11A)A Volume Variance Is Computed For