A company operates a standard marginal costing system.last month its actual overhead expenditure was 10% above budget resulting in a fixed expenditure variance of $36000
Ans
expenditure variance 36000
=10% of budgeted expenditure
therefore budgeted expenditure 360000
actual expenditure variance 36000/10x 110
396000
sir could u please explain me how have they solved the question?
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variances
10y ago#1For every 100 budget, the actual must be 10 higher and be therefore 110.
Or, putting it the other way round, for every 10 variance, then actual must be 110.
Therefore, for a variance of 36,000, the actual must be (110/10) x 36,000 = 396,000
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