The Difference Between the Total Actual Overhead Cost Incurred During

question 104

Multiple Choice

The difference between the total actual overhead cost incurred during a period and budgeted total factory overhead cost for the actual quantity of the cost driver used to apply overhead is equal to the:

• A) Total overhead spending variance.
• B) Total overhead efficiency variance.
• C) Factory overhead production-volume variance.
• D) Total overhead rate variance.
• E) Total overhead variance.

---

Definitions:

Planning Budget

A budget designed for a particular level of activity, often used for planning and forecasting purposes.

Direct Labor

Factory labor costs that can be easily traced to individual units of product. Also called touch labor.

Units

A measure of quantity in accounting, production, or inventory management, often used to quantify the amount of output or sales.

Net Operating Income

The profit generated from a company's core business operations, excluding deductions for interest and taxes.