The difference between budgeted volume and practical capacity,multiplied by the fixed overhead rate,is the
A)Expected (planned)capacity variance.
B)Unexpected (unplanned)capacity variance.
C)Total capacity variance.
D)Volume variance.

Question

Quizplus · Accepted Answer

The expected (planned) capacity variance is calculated by taking the difference between the budgeted volume and practical capacity, then multiplying it by the fixed overhead rate. This variance reflects the difference between what was planned and what is practically achievable.

The Difference Between Budgeted Volume and Practical Capacity,multiplied by the Fixed