Normally, managers will not see many fixed overhead spending variances because
A)many fixed costs are contracted for or known ahead of time.
B)fixed costs vary in proportion to activity, so differences do not normally arise.
C)most fixed costs are allocated (such as depreciation), so no differences occur.
D)actual fixed costs rarely differ from budgeted fixed costs.

Question

Quizplus · Accepted Answer

Fixed overhead costs are typically contracted for or known ahead of time, such as rent or insurance premiums. Therefore, there is usually little variance in these costs between actual and budgeted amounts.

Normally, Managers Will Not See Many Fixed Overhead Spending Variances