output is 4,800 units and the actual overheads are £44,800. What is the fixed overhead expenditure variance? a) £3,200 Adverse
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
A company manufactures one product, the JB3. Budgeted fixed overhead per unit is £1 and budgeted output is 4,000 units. Actual output is 4,800 units and the actual
What is the fixed overhead expenditure variance?
a) £3,200 Adverse
b) £4,800 Favourable
c) £4,800 Adverse
d) £3,200 Favourable
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