When there is a difference between the actual and the standard capacity,which of the following,based solely on fixed overhead,occurs:
A)Production variance.
B)Volume variance.
C)Overhead cost variance.
D)Quantity variance.
E)Controllable variance.

Question

Quizplus · Accepted Answer

The difference between actual and standard capacity is related to the volume of production, therefore, the variance is known as the Volume variance. This variance is caused by the fixed overheads in relation to the actual level of activity.

When There Is a Difference Between the Actual and the Standard