The difference between the actual fixed overhead cost incurred during a period and the budgeted fixed overhead cost for the period is the:
A) Fixed overhead efficiency variance.
B) Fixed overhead production-volume variance.
C) Fixed overhead spending variance.
D) Fixed overhead rate variance.
E) Fixed overhead sales-volume variance.

Question

Quizplus · Accepted Answer

The difference between the actual fixed overhead cost incurred and the budgeted fixed overhead cost is known as the fixed overhead spending variance. This variance captures how much was spent compared to what was budgeted for fixed overhead costs. The other variances, such as the fixed overhead efficiency variance and fixed overhead production volume variance, relate to different factors and are calculated using different inputs.

The Difference Between the Actual Fixed Overhead Cost Incurred During