What Will Cause the Variable-Overhead Efficiency Variance

question 59

Multiple Choice

What will cause the variable-overhead efficiency variance?

• A)Efficient or inefficient use of a specific component of variable overhead (e.g. ,electricity).
• B)Full or partial utilization of major equipment resources.
• C)Production of units in excess of the number of units sold.
• D)Efficient or inefficient use of the cost driver (e.g. ,machine hours)for variable overheaD.
• E)Changes in the salary cost of manufacturing supervisors.

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Definitions:

Applied Overhead

The estimated overhead cost allocated to particular cost objects, based on a predetermined rate.

Actual Overhead

The real expenses incurred for overhead in a given period, as opposed to budgeted or estimated costs.

Production Jobs

Positions in manufacturing that involve direct involvement in the creation of products, such as assembly line work or machine operation.

Job-Order Costing

A cost accounting system that assigns costs to specific production batches or jobs, useful for customized or unique products.