Underapplied fixed factory overhead can be explained by ________ variance and ________ variance.
A) production volume; fixed overhead efficiency
B) fixed overhead spending; fixed overhead efficiency
C) fixed overhead spending; fixed overhead flexible budget
D) fixed overhead spending; production volume

Question

Quizplus · Accepted Answer

Underapplied fixed factory overhead occurs when the actual overhead costs are higher than the applied overhead costs. This can be due to higher-than-expected spending (fixed overhead spending variance) or lower-than-expected production levels (production volume variance).

Underapplied Fixed Factory Overhead Can Be Explained by ________ Variance