How is the fixed overhead budget variance calculated?
A)The difference between the standard fixed overhead rate and the actual fixed overhead rate multiplied by the actual hours used
B)The difference between the standard fixed overhead costs allocated and the budgeted fixed overhead costs
C)The difference between the actual fixed overhead costs incurred and the budgeted fixed overhead costs
D)The difference between the actual fixed overhead costs incurred and the standard fixed overhead costs allocated

Question

Quizplus · Accepted Answer

The fixed overhead budget variance is the difference between the actual fixed overhead costs incurred and the budgeted fixed overhead costs. Option A calculates the fixed overhead volume variance, while Option B calculates the fixed overhead cost variance. Option D calculates the fixed overhead production volume variance.

How Is the Fixed Overhead Budget Variance Calculated