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Unformatted text preview: -budgeted FOH = $122,000 -$120,000 = $2,000 Unfavorable 4) Fixed-overhead volume variance = budgeted FOH-= $120,000 -$108,000 = $12,000 (Positive) ** = (predetermined FOH rate) x (standard allowed hours) = 3 x 36,000 = $108,000 predetermined fixed overhead rate = $120,000 / 10,000 x 4 = 3 standard allowed hours = 9,000 x 4 = 36,000 hrs. ** Consistent with the discussion in the text, we choose not to interpret the volume variance as either favorable or unfavorable. Some accountants would designate a positive volume variance as "unfavorable" and a negative volume variance as "favorable." * SH = applied fixed overhead ^ ^ applied fixed overhead...
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This note was uploaded on 02/29/2012 for the course E 101 taught by Professor Sfere during the Spring '12 term at Abilene Christian University.
- Spring '12