Incurring Actual Indirect Factory Wages in Excess of Budgeted Amounts

question 2

Multiple Choice

Incurring actual indirect factory wages in excess of budgeted amounts for actual production results in a:

• A)unfavorable quantity variance.
• B)unfavorable controllable variance.
• C)favorable volume variance.
• D)favorable labor rate variance.

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Definitions:

Single Plantwide Overhead Rate

A method of applying overhead to products in which support department costs are combined with all other overhead costs, and the total overhead cost is then applied to the products using a single cost driver.

Multiple Production Department Rates

Costing rates used for different departments within a production process, reflecting the varying costs associated with each department.

Allocate

To allocate means to distribute resources or duties for a specific purpose or to particular entities.

Distribute

To share or spread something, especially resources or goods, among a group of people or over an area.