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Is the volume variance a controllable variance from a spending point of view?
No, the volume variance is controllable but not related to spending. The volume variance calculates the dollar impact of producing more or less than the budgeted production volume. No, the volume variance is controllable but not related to spending. The volume variance calculates the dollar impact of producing more or less than the budgeted production volume.
Why is it important to determine the contribution point?
Once the contribution margin is determined, it can be used to calculate the break-even point in volume of units or in total sales dollars.
A favorable fixed overhead volume variance occurs if?
Favourable fixed overhead variance occurs when actual fixed cost is less than the budgeted fixed overhead expenses.
What difference between a favorable variance and an unfavorable variance?
Favourable variance is that variance which is good for business while unfavourable variance is bad for business
What factors causes Budget Variance?
There are 7 variances associated with a budget ( which are generally calculated for controlling purposes) 1- Material Price variance 2- Material Quantity variance 3- Labor rate variance 4- Labor efficiency variance 5- Spending variance 6- Efficiency variance 7- Capacity variance
