Question

How do you classify overheads under normality basis?

Answer 1

Variable overheads costs vary in total in direct proportion to the volume of output. These costs per unit remain relatively constant with changes in production. Thus variable costs fluctuate in total amount in direct proportion to the volume of output but tend to remain constant per unit as production activity changes.

Answer 2

Answer:

Variable overheads costs vary in total in direct proportion to the volume of output. These costs per unit remain relatively constant with changes in production. Thus variable costs fluctuate in total amount in direct proportion to the volume of output but tend to remain constant per unit as production activity changes.