Alex Company has a large underapplied overhead balance in the manufacturing overhead account. This could be explained by: A. an unfavorable volume variance, assuming all other variances are zero. B. a favorable volume variance, assuming all other variances are zero. C. standard hours allowed for the period's output being greater than denominator hours for the period. D. none of these
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.
Alex Company has a large underapplied
A. an unfavorable volume variance, assuming all other variances are zero.
B. a favorable volume variance, assuming all other variances are zero.
C. standard hours allowed for the period's output being greater than denominator hours for the period.
D. none of these
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