Question

1) The fixed overhead cost variance can be further subdivided into the ________.

A) price variance and the efficiency variance
B) spending variance and flexible-budget variance
C) production-volume variance and the efficiency variance
D) flexible-budget variance and the production-volume variance

Answer 1

The fixed overhead cost variance can be further subdivided into the flexible-budget variance and the production-volume variance.

Step-by-step explanation:

The fixed overhead cost variance can be further subdivided into the flexible-budget variance and the production-volume variance. These variances help analyze the differences between the planned and actual fixed overhead costs. The flexible-budget variance measures the difference between the budgeted fixed overheads and the actual fixed overheads based on the flexible budget, while the production-volume variance measures the effect of changes in the production level on fixed overhead costs.