A favorable overhead spending variance means that:a. Overhead has been overapplied.b. Overhead has been underapplied.c. Actual production was less than the normal volume ofoutput.d. None of the above.

A favorable overhead spending variance means that:a. Overhead has been overapplied.b. Overhead has been underapplied.c. Actual production was less than the normal volume ofoutput.d. None of the above.

Name: A favorable overhead spending variance means that:a. Overhead has been
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Description: A favorable overhead spending variance means that:a. Overhead has been overapplied.b. Overhead has been underapplied.c. Actual production was less than the normal volume ofoutput.d. None of the above.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Which of the following statements about fixed overhead variances is FALSE? An unfavorable volume variance means that a firm’s production facilities were under-utilized by producing less units of products than budgeted. Fixed overhead variances consist of a budget variance and a volume variance. The volume variance is a measure of facility utilization. The budget variance represents the difference between the original budgeted fixed overhead cost and the applied fixed overhead cost during a period.
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Which of the following statements about fixed overhead variances is FALSE? O The budget variance represents the difference between the original budgeted fixed overhead cost and the applied fixed overhead cost during a period. O An unfavorable volume variance means that a firm's production facilities were under-utilized by producing less units of products than budgeted. O The volume variance is a measure of facility utilization. O Fixed overhead variances consist of a budget variance and a volume variance. Ne: Previous
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At the beginning of the year, you estimated the following - Production - 75,000 units Raw Material - 270,000 pounds at a cost of $1,026,000 Direct Labor - 187,500 hours at a cost of $4,125,000 Variable Overhead - 135,000 machine hours at a cost of $567,000 Fixed Overhead - $900,000 At the end of year, the actual results were as follows - Production - 73,000 units Raw Material - 265,720 pounds purchased and used at a cost of $1,036,308 Direct Labor - 179,580 hours at a cost of $3,968,718 Variable Overhead - 133,590 machine hours at a cost of $558,406.20 Fixed Overhead - $891,000