Particulars Standard Actual Output in units 1,200 units 1,100 units Variable overheads $6,000 $7,000 Labor hours 12,000 hours 18,000 hours Calculate Variable overhead expenditure variance Choose option: A) 2,000 (F) B) 2,000 (A) C) 9,000 (A) D) 9,000 (F)
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.
| Particulars | Standard | Actual |
| Output in units | 1,200 units | 1,100 units |
| Variable |
$6,000 | $7,000 |
| Labor hours | 12,000 hours | 18,000 hours |
Calculate Variable overhead expenditure variance
Choose option:
A) 2,000 (F)
B) 2,000 (A)
C) 9,000 (A)
D) 9,000 (F)
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