The Formula for Computing the Overhead Volume Variance Is

question 151

Multiple Choice

The formula for computing the overhead volume variance is

• A) fixed overhead rate times (actual hours less standard hours allowed).
• B) variable overhead rate times (actual hours less standard hours allowed).
• C) fixed overhead rate times (normal capacity hours less standard hours allowed).
• D) variable overhead rate times (normal capacity hours less standard hours allowed).

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Definitions:

Consolidated Financial Statements

Financial statements that present the assets, liabilities, and operating results of a parent company and its subsidiaries as one entity.

Beginning Inventory

The value of all inventory held by a company at the start of an accounting period.

Ignoring Income Taxes

Refers to the accounting practice or principle where income taxes are not considered in the calculation of financial metrics or performance evaluations.

Deferred Tax Asset

A tax reduction amount that can be used to offset future taxable income, arising from temporary differences between book and tax income.