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What Does An Unfavorable Volume Variance Indicate? |
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Answer» An unfavorable VOLUME variance indicates that the amount of fixed manufacturing overhead COSTS applied (or assigned) to the manufacturer's output was less than the budgeted or planned amount of fixed manufacturing overhead costs for the same TIME PERIOD. The unfavorable volume variance indicates that the period's output was less than the planned output. The volume variance is also referred to as the production volume variance, the capacity variance, or the idle capacity variance. An unfavorable volume variance indicates that the amount of fixed manufacturing overhead costs applied (or assigned) to the manufacturer's output was less than the budgeted or planned amount of fixed manufacturing overhead costs for the same time period. The unfavorable volume variance indicates that the period's output was less than the planned output. The volume variance is also referred to as the production volume variance, the capacity variance, or the idle capacity variance. |
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