The Overhead Variance Is Equal to the Difference Between

question 93

Multiple Choice

The overhead variance is equal to the difference between

• A) fixed overhead costs and flexible overhead costs.
• B) estimated overhead rate and applied overhead rate.
• C) actual overhead costs and variable overhead costs.
• D) actual overhead costs and standard overhead costs.

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Definitions:

Extraordinary Items

Events and transactions that are distinct from the ordinary activities of a company and have a significant impact on its financial position.

Discontinued Operations

Parts of a company's business that have been sold, disposed of, or otherwise terminated, which are reported separately from continuing operations in financial statements.

Systematic Allocation

The process of apportioning costs or revenues over a specific period in a methodical and logical manner, often used in depreciation and amortization.

Immediate Recognition

The accounting practice of recording revenues or expenses as soon as they are incurred, without deferral.