Question

Which of the following is used in the computation of the variable-overhead spending variance?

a) Actual Variable
b) Overhead Cost
c) Budgeted Variable
d) Overhead Based on Actual Hours
e) Standard Variable

Answer 1

The computation of the variable-overhead spending variance uses the actual variable overhead cost.

Thus, the correct option is A.

Step-by-step explanation:

The computation of the variable-overhead spending variance uses the actual variable overhead cost, which is option (a) Actual Variable.

In the calculation of the variable-overhead spending variance, the formula used is:

Variable-Overhead Spending Variance = Actual Variable Overhead Cost - (Actual Hours x Budgeted Variable Overhead Rate)

Therefore, the correct answer is option (a) Actual Variable.