Vinton Inc. provides the following details for the year: Type of variance Amount Variable manufacturing overhead spending $30,600 F Variable manufacturing overhead efficiency $102,000 U Fixed overhead spending $61,200 U Operating income volume $122,400 U Fixed overhead production volume $312,800 U What will be the sales-volume variance for operating income of Vinton Inc. for the year
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.
Vinton Inc. provides the following details for the year:
|
Type of variance |
Amount |
|
Variable manufacturing |
$30,600 F |
|
Variable manufacturing overhead efficiency |
$102,000 U |
|
Fixed overhead spending |
$61,200 U |
|
Operating income volume |
$122,400 U |
|
Fixed overhead production volume |
$312,800 U |
What will be the sales-volume variance for operating income of Vinton Inc. for the year?
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