Question
Factory’s budget estimated 10,000 units output; fixed
overhead budget ₹20 lakh. Actual output 8,000 units. Compute FOVV.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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