When machine hours are used as an overhead cost allocation base and annual leasing costs for equipment unexpectedly increase, the most likely result would be to report a(n) a unfavourable variable overhead spending variance b favourable variable overhead efficiency variance c unfavourable fixed overhead flexible budget variance d favourable production volume variance e None of the answers

Question: When machine-hours are used as an overhead cost-allocation base and annual leasing costs for equipment unexpectedly increase, the most likely result would be to report

When machine-hours are used as an overhead cost-allocation base and annual leasing costs for equipment unexpectedly increase, the most likely result would be to report a(n) ________.

	a.	unfavourable variable overhead spending variance
	b.	favourable variable overhead efficiency variance
	c.	unfavourable fixed overhead flexible-budget variance
	d.	favourable production-volume variance
	e.	None of the answers.

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