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    • Question

      Factory’s budget estimated 10,000 units output; fixed

      overhead budget ₹20 lakh. Actual output 8,000 units. Compute FOVV.
      A ₹4 lakh Adverse Correct Answer Incorrect Answer
      B ₹4 lakh Favourable Correct Answer Incorrect Answer
      C ₹2 lakh Adverse Correct Answer Incorrect Answer
      D ₹2 lakh Favourable Correct Answer Incorrect Answer
      E Nil Correct Answer Incorrect Answer

      Solution

      Standard fixed overhead per unit = ₹20 lakh / 10,000 = ₹200. Actual output 8,000, overhead absorbed = ₹16 lakh. Actual fixed overhead ₹20 lakh; adverse variance ₹4 lakh.

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