december 2006 pev paper
wolfe
Registered Posts: 121 Dedicated contributor 🦉
hey every one. i was doing the paper but i got stuck.
total fixed overhead varaince (under/over absorbed)=fixed overhead volume variance+fixed overhead expenditure varaince. right???
but in this case here ,as you can see
1790 is not equal to 4200 (F)+2000(F)
where am i going wrong.pleeeease help. thanks in advance
total fixed overhead varaince (under/over absorbed)=fixed overhead volume variance+fixed overhead expenditure varaince. right???
but in this case here ,as you can see
1790 is not equal to 4200 (F)+2000(F)
where am i going wrong.pleeeease help. thanks in advance
0
Comments

This might help 
Total Fixed O/H Capacity Variance + Total Fixed O/H Efficiency Variance = Total Fixed O/H Volume Variance.
I think you are using the wrong equation.
Tracy0 
Wolfe
What an excellent question.
There are different ways of absorbing overheads. In intermediate ECR you look at absorption costing based on hours worked.
 In technician PEV you look at standard absorption costing based on standard hours produced.
Here the actual hours worked were: 27,930
But as we are in a standard costing environment we do not use these hours for the overheads absorbed.
Instead we use 29,400 standard hours based on 117,600 units produced each being equivalent to 0.25 standard hours.
So the overabsorption is £6,200 (which is equal to the expenditure variance plus the volume variance)
At one time the model answer had the wrong answer to 1.1 a vi, this should be £88,200 (in case it is still wrong)Sandy
sandy@sandyhood.com
www.sandyhood.com0 
thank you Sandy hood
hi. thanks a billion Sandy hood. the puzzle solved atlast. thanks again.0
Categories
 All Categories
 1.2K Books to buy and sell
 2.3K General discussion
 12.5K For AAT students
 321 NEW! Qualifications 2022
 164 General Qualifications 2022 discussion
 11 AAT Level 2 Certificate in Accounting
 56 AAT Level 3 Diploma in Accounting
 87 AAT Level 4 Diploma in Professional Accounting
 8.8K For accounting professionals
 23 coronavirus (Covid19)
 272 VAT
 92 Software
 273 Tax
 135 Bookkeeping
 7.2K General accounting discussion
 200 AAT member discussion
 3.8K For everyone
 38 AAT news and announcements
 345 Feedback for AAT
 2.8K Chat and offtopic discussion
 582 Job postings
 16 Who can benefit from AAT?
 36 Where can AAT take me?
 42 Getting started with AAT
 26 Finding an AAT training provider
 48 Distance learning and other ways to study AAT
 25 Apprenticeships
 66 AAT membership