Because fixed overhead is made up of many items
A)the fixed overhead spending variance is not meaningful.
B)it is not possible to calculate a fixed overhead volume variance.
C)the fixed overhead volume variance will always be unfavorable.
D)a line by line comparison of budgeted costs with actual costs provides more information.
E)all of these.

Question

Quizplus · Accepted Answer

A line by line comparison of budgeted costs with actual costs provides more information because it allows for a more specific analysis of the various components of fixed overhead spending and can help pinpoint where adjustments may need to be made. While the fixed overhead volume variance is still a useful metric, it may not necessarily always be unfavorable and the fixed overhead spending variance may still be meaningful in some contexts.

Because Fixed Overhead Is Made Up of Many Items