What Is the Production Volume Variance A) $200
B) $400

question 96

Multiple Choice

What is the production volume variance? $$\begin{array} { l | r | } \hline \text { Actual machine hours } & 840 \\\hline \text { Standard machine hours allowed } & 900 \\\hline \text { Denominator activity (machine hours) } & 1,000 \\\hline \text { Actual fixed overhead costs } & \$ 3,800 \\\hline \text { Budgeted fixed overhead costs } & \$ 4,000 \\\hline \text { Predetermined overhead rate ( } \$ 1 \text { variable } + \$ 4 & \$ 5 \\\text { fixed) } & \\\hline\end{array}$$

• A) $200.
• B) $400.
• C) $300.
• D) $240.

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Definitions:

ROI

Return on Investment; a financial metric used to evaluate the efficiency or profitability of an investment or compare the efficiency of several investments.

Promotion Expenditures

Funds allocated by a business to carry out promotional activities aimed at boosting sales and enhancing brand visibility.

Promotion-to-Expenses Ratio

A metric analyzing the relationship between the amount spent on promotional activities and the overall expenditure of a business.

Hierarchy of Effects

A theory in advertising describing a sequence of stages a consumer goes through from initial awareness of a product to a purchase action.