The Variable Overhead Spending Variance Is Calculated by Comparing

question 30

Multiple Choice

The variable overhead spending variance is calculated by comparing:

• A) Actual variable overhead cost incurred and the standard variable overhead rate times the actual amount of allocation base used during the period
• B) Actual variable overhead cost incurred and the fixed overhead cost incurred
• C) Actual price of direct materials and the expected price
• D) Actual direct labour hours used and the expected amount

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Definitions:

Physical Count

A method used in inventory management where the actual number of items in stock is manually counted at specific intervals.

Accrued Expenses

Financial obligations that a company has incurred but has not yet paid.

Unpaid Expenses

Expenses that have been incurred but not yet paid, typically recorded as liabilities on a balance sheet.

Adjusting Process

A procedure in accounting that is carried out at the end of an accounting period to update the accounts and ensure they accurately reflect the financial activities and status of a business.