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FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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
Transcribed Image Text:Which of the following statements about fixed overhead variances is
FALSE?
O The budget variance represents the difference between the original budgeted
fixed overhead cost and the applied fixed overhead cost during a period.
O An unfavorable volume variance means that a firm's production facilities were
under-utilized by producing less units of products than budgeted.
O The volume variance is a measure of facility utilization.
O Fixed overhead variances consist of a budget variance and a volume variance.
Ne:
Previous
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- Which one is the correct answer?arrow_forwardTotal variance in variance analysis compares ● Flexible budget and actual outcome Static budget and flexible budget Flexible budget and static outcome Static budget and actual outcomearrow_forwardThe variable overhead efficiency variance is computed and interpreted. a) the same as; the same as b) the same as; differently than c) differently than; the same as d) differently than; differently than the direct-cost efficiency variance.arrow_forward
- At the beginning of the year, you estimated the following - Production - 75,000 units Raw Material - 270,000 pounds at a cost of $1,026,000 Direct Labor - 187,500 hours at a cost of $4,125,000 Variable Overhead - 135,000 machine hours at a cost of $567,000 Fixed Overhead - $900,000 At the end of year, the actual results were as follows - Production - 73,000 units Raw Material - 265,720 pounds purchased and used at a cost of $1,036,308 Direct Labor - 179,580 hours at a cost of $3,968,718 Variable Overhead - 133,590 machine hours at a cost of $558,406.20 Fixed Overhead - $891,000arrow_forwardList the fixed overhead variances, and briefly describe each.arrow_forwardin preparing variance analysis for both variable overhead and fixed overhead costs, both include spending variancesarrow_forward
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