The actual prices of factory utilities have gone up to be higher than the expectations and the actual usages also have increased to exceed the expectations. Which variance
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
QUESTION 8
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The actual prices of factory utilities have gone up to be higher than the expectations and the actual usages also have increased to exceed the expectations. Which variance(s) will be unfavorably affected?
A. both variable
overhead efficiency variance and direct labor efficiency variance.B. the variable overhead efficiency variance.
C. both variable overhead spending (price) and variable overhead efficiency variances.
D. the variable overhead spending (price) variance.
E. both variable overhead spending (price) variance and direct labor efficiency variance.
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