Factory Overhead Cost Elements
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Factory Overhead Cost Elements

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Questions and Answers

Fixed overhead costs are those that fluctuate with the level of production.

False

Variable overhead costs include salaries for administrative staff.

False

Variable overhead costs may be challenging to control and keep within a budget.

True

Factory overhead variance is separated into a material variance and a labor variance.

<p>False</p> Signup and view all the answers

The controllable variance in factory overhead reflects the difference between actual and budgeted overhead costs.

<p>True</p> Signup and view all the answers

Volume variance in factory overhead arises due to fluctuations in the level of production activity.

<p>True</p> Signup and view all the answers

Fixed overhead costs remain constant regardless of changes in production levels.

<p>True</p> Signup and view all the answers

Variable overhead costs like production supplies and energy costs increase as production output decreases.

<p>False</p> Signup and view all the answers

The controllable variance in factory overhead measures the efficiency of management in controlling costs.

<p>True</p> Signup and view all the answers

Volume variance in factory overhead is caused by differences between budgeted and actual production levels.

<p>True</p> Signup and view all the answers

Wages for workers handling and shipping the product are considered fixed overhead costs.

<p>False</p> Signup and view all the answers

Factory overhead cost includes both fixed and variable cost elements.

<p>True</p> Signup and view all the answers

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