The Overhead Cost Variance Is

question 12

Multiple Choice

The overhead cost variance is:

• A)The difference between the overhead costs actually incurred and the overhead budgeted at the actual operating level.
• B)The difference between the actual overhead incurred during a period and the standard overhead applied.
• C)The difference between actual and budgeted cost caused by the difference between the actual price per unit and the budgeted price per unit.
• D)The costs that should be incurred under normal conditions to produce a specific product (or component)or to perform a specific service.
• E)The difference between the total overhead cost that would have been expected if the actual operating volume had been accurately predicted and the amount of overhead cost that was allocated to products using the standard overhead rate.

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Definitions:

Non-rivalrous

A characteristic of a good whereby one person's use does not diminish the utility or availability of that good for others.

Laissez-faire System

A laissez-faire system is an economic principle advocating minimal government intervention in the operations of free markets and the economic decisions of individuals and businesses.

Market

A market is a platform or environment where buyers and sellers come together to facilitate the exchange of goods, services, or information.

Capital Goods

Long-lasting goods acquired by a business to produce goods or services, as opposed to being sold directly to consumers.