A firm uses machine hours to allocate fixed overhead. During the period, budgeted fixed overhead is Rs. 30000. The budgeted machine hours is 100 hours for budgeted volume of 1000 units. The firm produced 1200 units consuming 150 hours and spent Rs. 28000 towards fixed overhead. The fixed overhead spending variance is Rs. 17000 favorable Rs. 17000 adverse Rs. 2000 favorable Rs. 8000 favorable

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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A firm uses machine hours to allocate fixed overhead. During the period, budgeted fixed overhead is Rs. 30000. The budgeted machine hours is 100 hours for budgeted volume of 1000 units. The firm produced 1200 units consuming 150 hours and spent Rs. 28000 towards fixed overhead. The fixed overhead spending variance is

Rs. 17000 favorable
Rs. 17000 adverse
Rs. 2000 favorable
Rs. 8000 favorable
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The fixed overhead spending variance refers to the differentiation among the the actual fixed production overhead expenditure or spending (AFPOE) and the budgeted fixed production overhead expenditure or spending (BFPOE).

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