A company has a favorable variable overhead spending variance,an unfavorable variable overhead efficiency variance,and underapplied variable overhead at the end of a period.The journal entry to record these variances and close the variable overhead control account will show which of the following?
VOH spencing $ \mathrm{VOH} $ efficiency

$\text {\underline{ variance} }$ $\text {\underline{variance} }$ $\text {\underline{ VMOH} }$

A)debit credit credit
B)credit debit credit
C)debit credit debit
D)credit debit debit

Question

A company has a favorable variable overhead spending variance,an unfavorable variable overhead efficiency variance,and underapplied variable overhead at the end of a period.The journal entry to record these variances and close the variable overhead control account will show which of the following?
VOH spencing                        $ \mathrm{VOH} $ efficiency

$\text {\underline{ variance} }$                                $\text {\underline{variance} }$                                          $\text {\underline{ VMOH} }$

A)debit credit credit
B)credit debit credit
C)debit credit debit
D)credit debit debit

Quizplus · Accepted Answer

A favorable variable overhead spending variance means the actual spending was less than the budgeted amount, so this variance is credited. An unfavorable variable overhead efficiency variance means more resources were used than expected, so this variance is debited. Underapplied variable overhead means not enough overhead was allocated to products, so additional overhead needs to be allocated, resulting in a debit to close the account.

A Company Has a Favorable Variable Overhead Spending Variance,an Unfavorable VOH \mathrm{VOH} VOH

A Company Has a Favorable Variable Overhead Spending Variance,an Unfavorable $\mathrm{VOH}$