When Does Budgeted Fixed Overhead Differ from Applied Fixed Overhead

question 24

Multiple Choice

When does budgeted fixed overhead differ from applied fixed overhead? (Assume the number of machine hours is the activity base.)

• A) During any period in which the number of standard machine hours allowed differs from the budgeted or planned activity level.
• B) It always differs.
• C) During any period in which actual overhead costs exceed planned overhead costs.
• D) During any period in which budgeted production equals planned production.

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