If the actual number of units manufactured is less than the number of units anticipated to be manufactured, then the fixed overhead volume variance will always be unfavorable.

Question

Quizplus · Accepted Answer

The fixed overhead volume variance is calculated by comparing the actual number of units produced with the budgeted or anticipated number of units. If the actual number of units produced is less than the anticipated number of units, the variance will be unfavorable, indicating that more overhead was incurred than planned. Therefore, the statement is true.

If the Actual Number of Units Manufactured Is Less Than