The Fixed Factory Overhead Application Rate Is a Function of a Predetermined

question 55

Multiple Choice

The fixed factory overhead application rate is a function of a predetermined activity level.If standard hours allowed for good output equal this predetermined activity level for a given period,the volume variance will be: (CPA adapted)

• A) zero.
• B) favorable.
• C) unfavorable.
• D) either favorable or unfavorable,depending on the budgeted overheaD.
• There is no volume variance when output = planned

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