Asked by macie hutchinson on Jul 30, 2024
Verified
One cause of an unfavourable overhead volume variance would be increases in cost for fixed overhead items.
Overhead Volume Variance
The difference between the budgeted and actual overhead costs, attributable to variations in production volume.
Fixed Overhead Items
Costs that do not change with the level of production or sales over a certain range, such as rent, salaries, and insurance.
- Recognize and examine the repercussions of variance constituents on fiscal performance.
Verified Answer
ZK
Zybrea KnightAug 03, 2024
Final Answer :
False
Explanation :
The overhead volume variance is caused by the difference between the actual hours worked and the budgeted hours. It is not affected by increases in cost for fixed overhead items.
Learning Objectives
- Recognize and examine the repercussions of variance constituents on fiscal performance.