Managers can always view a favorable variable overhead spending variance as desirable.

Question

Quizplus · Accepted Answer

Managers should not always view a favorable variable overhead spending variance as desirable. For example, the variable overhead spending variance would be favorable if managers purchased lower-priced, poor-quality indirect materials. These decisions, however, are likely to hurt product quality and harm the long-run prospects of the business.

Managers Can Always View a Favorable Variable Overhead Spending Variance