The unfavorable volume variance may be due to all of the following factors except
A) failure to maintain an even flow of work
B) machine breakdowns
C) unexpected increases in the cost of utilities
D) failure to obtain enough sales orders

Question

Quizplus · Accepted Answer

The unfavorable volume variance is related to the difference between the actual volume of output and the budgeted volume of output. The other factors listed (failure to maintain an even flow of work, machine breakdowns, and failure to obtain enough sales orders) all directly impact the volume of output and can lead to a lower-than-budgeted volume. However, unexpected increases in the cost of utilities would not directly impact the volume of output and thus would not be a factor in the unfavorable volume variance.

The Unfavorable Volume Variance May Be Due to All of the Following