The following information is derived from the cost sheet of Al Hood Manufacturing & Trading LLC: Manufacturing overhead RO 5,000 Selling & Distribution overhead RO 2,000 Direct material RO 10,000 Direct expenses RO 4,000 Administration overheads RO 1,000 Direct labor RO 3,000
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.
The following information is derived from the cost sheet of Al Hood Manufacturing & Trading LLC:
Manufacturing overhead RO 5,000
Selling & Distribution overhead RO 2,000
Direct material RO 10,000
Direct expenses RO 4,000
Administration
Direct labor RO 3,000
Use the above information and answer 29, 30 and 31 MCQs
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