Which of the following is true about the variable overhead spending variance?
A)The variable overhead spending variance measures the aggregate effect of differences in the actual variable overhead rate and the standard variable overhead rate.
B)The variable overhead spending variance measures the change in variable overhead consumption that occurs because of efficient (or inefficient) use of direct labor.
C)The variable overhead spending variance is calculated by deducting actual direct labor hours used from standard direct labor hours that should have been used.
D)The variable overhead spending variance is calculated by deducting actual variable overhead from standard variable overhead.

Question

Quizplus · Accepted Answer

The variable overhead spending variance is indeed calculated based on the difference between the actual variable overhead rate incurred and the standard variable overhead rate that was expected or budgeted. This variance helps in understanding how well the company managed its variable overhead costs in relation to the standard rates it had set.

Which of the Following Is True About the Variable Overhead