Spending Variance: It indicates the amount of actual cost incurred for actual production over the estimated or expected cost for the same level of production. Production-Volume Variance: It reports that amount which is result of the multiplication of difference between actual output and budgeted output of particular period with the budgeted rate. This variance indicates the production efficiency of a company. To prepare: . The variance analysis of fixed overhead .

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Answer 1

Question

Chapter 8, Problem 8.19E

1.

To determine

Spending Variance:

It indicates the amount of actual cost incurred for actual production over the estimated or expected cost for the same level of production.

Production-Volume Variance:

It reports that amount which is result of the multiplication of difference between actual output and budgeted output of particular period with the budgeted rate. This variance indicates the production efficiency of a company.

To prepare:. The variance analysis of fixed overhead.

2.

To determine

Fixed Cost:

The cost which does not fluctuate on the basis of the output level produced. It remains same, no matter output level increases or decreases.

The amount of fixed overhead is under-allocated or over-allocated.

3.

To determine

To explain: The overview of results and reason for it.

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Bigco Corporation is one of the nation's leading distributors of food and related products to restaurants, universities, hotels, and other customers. A simplified version of its recent income statement contained the following items (in millions). Cost of sales es Interest expense Income taxes Net earnings Sales Earnings before income taxes Selling, general, and administration expense Other revenues Total expenses (excluding income taxes) Total revenues $ 11,601 249 39 1,378 16,330 1,627 3,493 430 15,133 16,760 Prepare an income statement for the year ended June 30, current year. (Hint: First order the items as they would appear on the income statement and then confirm the values of the subtotals and totals.) Note: Enter your answers in millions rather than in dollars (for example, 5,000 million should be entered as 5,000 rather than 5,000,000). Revenues: Total revenues Expenses: BIGCO CORPORATION Income Statement (in millions) $ 0

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Answer 2

Question

Chapter 8, Problem 8.19E

1.

To determine

Spending Variance:

It indicates the amount of actual cost incurred for actual production over the estimated or expected cost for the same level of production.

Production-Volume Variance:

It reports that amount which is result of the multiplication of difference between actual output and budgeted output of particular period with the budgeted rate. This variance indicates the production efficiency of a company.

To prepare:. The variance analysis of fixed overhead.

2.

To determine

Fixed Cost:

The cost which does not fluctuate on the basis of the output level produced. It remains same, no matter output level increases or decreases.

The amount of fixed overhead is under-allocated or over-allocated.

3.

To determine

To explain: The overview of results and reason for it.

Expert Solution & Answer

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Check out a sample textbook solution

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Answer 3

Question

Chapter 8, Problem 8.19E

1.

To determine

Spending Variance:

It indicates the amount of actual cost incurred for actual production over the estimated or expected cost for the same level of production.

Production-Volume Variance:

It reports that amount which is result of the multiplication of difference between actual output and budgeted output of particular period with the budgeted rate. This variance indicates the production efficiency of a company.

To prepare:. The variance analysis of fixed overhead.

2.

To determine

Fixed Cost:

The cost which does not fluctuate on the basis of the output level produced. It remains same, no matter output level increases or decreases.

The amount of fixed overhead is under-allocated or over-allocated.

3.

To determine

To explain: The overview of results and reason for it.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 8, Problem 8.19E

1.

To determine

Spending Variance:

It indicates the amount of actual cost incurred for actual production over the estimated or expected cost for the same level of production.

Production-Volume Variance:

It reports that amount which is result of the multiplication of difference between actual output and budgeted output of particular period with the budgeted rate. This variance indicates the production efficiency of a company.

To prepare:. The variance analysis of fixed overhead.

2.

To determine

Fixed Cost:

The cost which does not fluctuate on the basis of the output level produced. It remains same, no matter output level increases or decreases.

The amount of fixed overhead is under-allocated or over-allocated.

3.

To determine

To explain: The overview of results and reason for it.

Expert Solution & Answer

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Answer 5

Chapter 8, Problem 8.19E

1.

To determine

Spending Variance:

It indicates the amount of actual cost incurred for actual production over the estimated or expected cost for the same level of production.

Production-Volume Variance:

It reports that amount which is result of the multiplication of difference between actual output and budgeted output of particular period with the budgeted rate. This variance indicates the production efficiency of a company.

To prepare:. The variance analysis of fixed overhead.

2.

To determine

Fixed Cost:

The cost which does not fluctuate on the basis of the output level produced. It remains same, no matter output level increases or decreases.

The amount of fixed overhead is under-allocated or over-allocated.

3.

To determine

To explain: The overview of results and reason for it.

Answer 6

Chapter 8, Problem 8.19E

1.

To determine

Spending Variance:

It indicates the amount of actual cost incurred for actual production over the estimated or expected cost for the same level of production.

Production-Volume Variance:

It reports that amount which is result of the multiplication of difference between actual output and budgeted output of particular period with the budgeted rate. This variance indicates the production efficiency of a company.

To prepare:. The variance analysis of fixed overhead.

Answer 7

Chapter 8, Problem 8.19E

1.

To determine

Spending Variance:

It indicates the amount of actual cost incurred for actual production over the estimated or expected cost for the same level of production.

Production-Volume Variance:

It reports that amount which is result of the multiplication of difference between actual output and budgeted output of particular period with the budgeted rate. This variance indicates the production efficiency of a company.

To prepare:. The variance analysis of fixed overhead.

Answer 8

2.

To determine

Fixed Cost:

The cost which does not fluctuate on the basis of the output level produced. It remains same, no matter output level increases or decreases.

The amount of fixed overhead is under-allocated or over-allocated.

Answer 9

2.

To determine

Fixed Cost:

The cost which does not fluctuate on the basis of the output level produced. It remains same, no matter output level increases or decreases.

The amount of fixed overhead is under-allocated or over-allocated.

Answer 10

3.

To determine

To explain: The overview of results and reason for it.

Answer 11

3.

To determine

To explain: The overview of results and reason for it.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 8 - How do managers plan for variable overhead costs?Ch. 8 - How does the planning of fixed overhead costs...Ch. 8 - How does standard costing differ from actual...Ch. 8 - What are the steps in developing a budgeted...Ch. 8 - What are the factors that affect the spending...Ch. 8 - Assume variable manufacturing overhead is...Ch. 8 - Describe the difference between a direct materials...Ch. 8 - What are the steps in developing a budgeted fixed...Ch. 8 - Why is the flexible-budget variance the same...Ch. 8 - Explain how the analysis of fixed manufacturing...

Fixed Cost: The cost which does not fluctuate on the basis of the output level produced. It remains same, no matter output level increases or decreases. The amount of fixed overhead is under-allocated or over-allocated.

To explain: The overview of results and reason for it.

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Chapter 8 Solutions

Fixed Cost:

The cost which does not fluctuate on the basis of the output level produced. It remains same, no matter output level increases or decreases.

The amount of fixed overhead is under-allocated or over-allocated.