Dear sir, in BPP Study text, there is 1 sample about overhead expenditure variance : if actual > budget, it is favourable.I think it is not true. And there is 1 sample about overhead volumn capacity variance: if actual<budget, it is adverse.Is it true ? Please help me to explain 2 samples.I find it is different with sale variance and material variance.Thank you.
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Overhead variance
6y ago#1I do not have the BPP Study Text - only the Revision Kit.
If actual expenditure is more than budget then it is an adverse variance.
As far as the volume variance is concerned, I assume you are referring to the fixed overhead volume variance in which case if actual is less than budget then the variance is adverse. I explain why in my free lectures. (I know you wrote that your listening English is not so good, but I did suggest that you turn on the subtitles).
Dear Sir, thank you, I will try to remember that when actual O/H volume < budget O/H volume, the variance is adverse.
6y ago#3You are welcome :-)
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