Use the following information to answer the following Questions
Bannister Motors Corporation reported the following variances for the period just ended:
Variable-overhead spending variance: $50,000U
Variable-overhead efficiency variance: $28,000U
Fixed-overhead budget variance: $70,000U
Fixed-overhead volume variance: $30,000U

-If Bannister prepared an overhead cost performance report, which of these overhead variances is likely to be excluded from the report?
A) Variable-overhead spending variance.
B) Variable-overhead efficiency variance.
C) Fixed-overhead budget variance.
D) Fixed-overhead volume variance.
E) None of the variances would be excluded.

Question

Use the following information to answer the following Questions
Bannister Motors Corporation reported the following variances for the period just ended: 
Variable-overhead spending variance: $50,000U
Variable-overhead efficiency variance: $28,000U
Fixed-overhead budget variance: $70,000U
Fixed-overhead volume variance: $30,000U

-If Bannister prepared an overhead cost performance report, which of these overhead variances is likely to be excluded from the report?
A) Variable-overhead spending variance.
B) Variable-overhead efficiency variance.
C) Fixed-overhead budget variance.
D) Fixed-overhead volume variance.
E) None of the variances would be excluded.

Quizplus · Accepted Answer

The fixed-overhead volume variance is typically excluded from an overhead cost performance report because it relates to the level of production activity rather than the efficiency or spending control of overhead costs.

Use the Following Information to Answer the Following Questions