The Variable Overhead Efficiency Variance Measures the Difference Between the ________

question 27

Multiple Choice

The variable overhead efficiency variance measures the difference between the ________, multiplied by the budgeted variable overhead cost per unit of the cost-allocation base.

• A) budgeted quantity of the cost-allocation base used and the budgeted quantity of the cost-allocation base that should have been used to produce the actual output
• B) actual quantity of the cost-allocation base used and the budgeted quantity of the cost-allocation base that should have been used to produce the actual output
• C) actual cost incurred and the budgeted quantity of the cost-allocation base that should have been used to produce the actual output
• D) budgeted cost and the actual cost used to produce the actual output

---

Definitions:

Maintenance Cost

Expenses incurred in the regular upkeep and repair of equipment, buildings, or machinery to ensure efficient operation and prevent breakdowns.

Contribution Margin

The difference between the sales revenue of a product and its variable costs, used to cover fixed costs and generate profit.

Sales Revenues

The total amount of money generated from sales of goods or services before any expenses are subtracted.

Variable Costs

Costs that vary directly with the level of production or sales volume, such as raw materials and packaging.