There is NOT an output-level variance for variable costing, because:
A)the inventory level decreased during the period
B)the inventory level increased during the period
C)fixed manufacturing overhead is allocated to work in process
D)fixed manufacturing overhead is not allocated to work in process

Question

Quizplus · Accepted Answer

Variable costing only includes variable manufacturing costs in product cost, while fixed manufacturing overhead costs are treated as period costs and are expensed in the period incurred. As such, fixed manufacturing overhead is not allocated to work in process in variable costing. Therefore, there is no output-level variance in variable costing.

There Is NOT an Output-Level Variance for Variable Costing, Because