The Following Standards for Variable Overhead Have Been Established for a Company

question 13

Multiple Choice

The following standards for variable overhead have been established for a company that makes only one product: The following data pertain to operations for the last month:
-What is the variable overhead rate variance for the month?

• A) $4,194 F
• B) $4,194 U
• C) $2,670 F
• D) $2,670 U

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Definitions:

Inflation

The velocity at which the aggregate cost of goods and services ascends, thereby reducing the efficacy of purchasing power.

Quick Ratio

A measure of a company's ability to meet its short-term obligations with its most liquid assets, excluding inventory, also known as the acid-test ratio.

Current Ratio

A liquidity metric that measures a company’s ability to pay short-term obligations with its current assets.

Industry Average

The average performance, metrics, or characteristics of companies within a particular sector.