Budgeted Fixed Overhead Is the Basis for Controlling Fixed Overhead

question 84

Multiple Choice

Budgeted fixed overhead is the basis for controlling fixed overhead because

• A) it provides the benchmark against which actual expenditure is compared.
• B) fixed overhead does not change as production activity varies.
• C) budgeted fixed overhead is the same at all activity levels in the flexible budget.
• D) All of the given answers

---

Definitions:

Significance Level

The probability of rejecting the null hypothesis when it is true, often denoted by alpha (α).

Chance

The occurrence of events in the absence of any deliberate intention or predictable causation, often used to describe random variability in data.

Confidence Interval

A range of values derived from sample data that is likely to contain the true population parameter with a certain level of confidence.