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A company currently calculates its variances using a standard marginal costing. If the company were to change to a standard absorption costing system.. Thats the question
Sales volume variance changes and total fixed overhead variance also changes
can u explain me how total fixed overhead variance changes????If they use absorption costing there is a fixed overhead expenditure and a fixed overhead volume variance.
With marginal costing there is only the fixed overhead expenditure variance.(The lectures on variance analysis explain the reasons in detail).
The accounting rate of return is the average profit per annum expressed as a percentage of the average investment.
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