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(1)
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.
To identify:. The spending variance is favorable or unfavorable.
(2).
Efficiency Variance:
It indicates the quantity of actual input over the budgeted input quantity at the budgeted rate.
To identify: The efficiency variance is favorable or unfavorable.
(3)
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.
The production-volume variance is favorable or unfavorable.
(4)
Flexible-
It reports the actual results over the results of flexible budgets and flexible budgets are those budgets which indicate the budgeted values for actual output.
The flexible-budget variance is favorable or unfavorable.
(5)
Variable Cost:
The cost which fluctuates on the basis of the output level produced. The variable cost and output shares a direct relationship.
Fixed Cost:
The cost which does not fluctuate on the basis of the output level produced. It remains same, no matter output increases or decreases.
To identify: The amount of manufacturing
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Chapter 8 Solutions
Cost Accounting (15th Edition)
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
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