What Does the Fixed Overhead Volume Variance Measure

question 24

Multiple Choice

What does the fixed overhead volume variance measure?

• A) the cost of unused activity capacity
• B) the cost of overspending on fixed overhead items
• C) the effect of the actual output differing from the output used to calculate the predetermined fixed overhead rate
• D) both the effect of the actual output differing from the output used to calculate the predetermined fixed overhead rate and the cost of unused activity capacity

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Definitions:

Supply Partnership

A long-term relationship between a buyer and a supplier characterized by mutual cooperation, shared risks, and investments to achieve joint value creation.

Mutually Beneficial Objectives

Objectives or goals set in a collaborative context that provide positive outcomes or advantages to all involved parties.

Ultimate Consumer

The end user of a product or service, who purchases it for personal use and not for resale or further processing.

Reciprocity

A mutual exchange of privileges or services between two parties where each benefits from the agreement.