What Can Create the Variable Overhead Efficiency Variance

question 53

Multiple Choice

What can create the variable overhead efficiency variance?

• A) Efficient or inefficient usage of a specific component of variable overhead (e.g. electricity)
• B) Production of units for finished goods inventory versus production for sale
• C) Efficient or inefficient use of the cost driver (e.g. machine hours) for variable overhead
• D) A difference between the planned level of output and the actual level of output

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Definitions:

Par Value

The face value of a bond or stock, as stated by its issuer, which is the nominal value and does not necessarily reflect its market value.

Conversion Value

The value of a convertible security if it is converted into a specified number of shares of the issuing company.

Common Stock

Equity ownership in a corporation, with voting rights and the potential for dividends and capital appreciation.