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The Fixed Overhead Application Rate Is a Function of a Predetermined

Question 77

Multiple Choice

The fixed overhead application rate is a function of a predetermined "normal" activity level.If standard hours allowed for good output equal this "normal" activity level for a given period,the production-volume variance will be:


A) Zero.
B) Favorable.
C) Unfavorable.
D) Either favorable or unfavorable depending on the budgeted overhead.

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