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Unit 8: Management Control through Variance Analysis
Summary Performance Report, January (` 000s) Notes
Actual Profit 132
Budgeted Profit 80
Variance 52
Analysis of Variance – Favourable/(Unfavourable)
Revenue Variances
Price (75)
Max 35
Volume 115
Net volume variance 75
Variable cost variances
Material (11)
Labour (12)
Variable overhead 10
Net Variable Cost Variance (13)
Fixed Cost variance
Selling expenses (5)
Admn. Expenses (5)
Net Fixed cost variance (10)
Total Variance 52
Self Assessment
Fill in the blanks:
7. Three types of standards are used for evaluating reports of actual activities: (1)
Predetermined standards (2) Historical standards (3) ………………….. .
8. A …………………..is a budget that is adjusted for changes in the level of the cost (or
revenue) driver.
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