Factors Contributing to the Fixed Factory Overhead Spending Variance Can

question 89

Multiple Choice

Factors contributing to the fixed factory overhead spending variance can include all except:

• A)Inaccurate budget estimates for these costs.
• B)Inadequate control of fixed overhead costs.
• C)Misclassification of cost items by the accounting system.
• D)Operating inefficiency.
• E)Unanticipated increases in costs such as factory insurance.

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Definitions:

Break-even Analysis

A calculation and assessment method to determine the point at which revenue received equals the costs associated with producing the revenue, indicating no net loss or gain.

Estimated Fixed Costs

Predicted expenses that do not fluctuate with the level of production or sales over a certain period of time.

Break-even Point

The point at which total costs and total revenue are equal, meaning that there are no net losses or gains.

Sales

The total revenue generated from the sale of goods or services related to a company's primary operations.