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Factory Overhead Volume Variance: Learning Objective of the article: Define and explain factory overhead volume variance. How is FOH volume variance calculated? Contents: Definition Formula Example Definition: Factory overhead volume…
Vertical Integration Definition: The involvement by a company in more than one of the steps from production of basic raw materials to the manufacture and distribution of a finished product.
Standard Costing System Discussion Questions and Answers: Questions: (a) Define standard costs. (b) Name some advantages of standard cost system. See answer A team of management consultants and company executives…
Work-in-Process Definition: Units of product that are only partially complete and will require further work before they are ready for sale to a customer.
Vertical Analysis and Common Size Statements: Definition and Explanation of Vertical Analysis and Common Size Statements: Vertical analysis is the procedure of preparing and presenting common size statements. Common size…
Revaluation Method of Depreciation: Learning Objectives: Define and explain the revaluation method of depreciation. When and where this method is used? As the name implies under revaluation method, the assets…
Vertical Analysis Definition: Vertical analysis presentation of a company's financial statements in common-size form is called vertical analysis.
Standard Costs-Management by Exception: Learning Objective of the Article: Define and explain the terms "standard cost" and "management by exception". Definition and Explanation of Standard Cost and Management by Exception:…
Standard Costing and Variance Analysis Formulas: Learning Objective of the article: Learn the formulas to calculate direct materials, direct labor and factory overhead variances.(Formula of Variance ) This is a collection…
Return on Investment (ROI) Definition: Net operating income divided by average operating assets. It also equals margin multiplied by turnover.
Variance Definition: The difference between standard prices and quantities on the one hand and actual prices and quantities on the other hand.
Variance Analysis and Management By Exception: Variance analysis and performance reports are important elements of management by exception. Simply put, management by exception means that the manager's attention should be…
Trend Percentage: Definition and Explanation: Horizontal analysis of financial statements can also be carried out by computing trend percentages. Trend percentage states several years' financial data in terms of a…
Return on Investment (ROI) and Balanced Scorecard: Simply exhorting managers to increase return on investment (ROI) is not sufficient. Managers who are told to increase return on investment (ROI) will…
Variable Spending Variance Definition: The difference between the actual variable overhead cost incurred during a period and the standard cost that should have been incurred based on the actual activity…
Variable Overhead Efficiency Variance Definition: The difference between the actual activity (direct labor-hours, machine-hours, or some other base) of a period and the standard activity allowed, multiplied by the variable…
Variable/Direct/Marginal and Absorption CostingDiscussion Questions and Answers: Questions: Differentiate between direct costs and direct costing. See answer. Distinguish between period costs and product costs. See answer. Why does the direct…
In real sense, ordinary shareholders are the real owners of the company. They assume the highest risk in the company. (Preference share holders have a preference over ordinary shareholders in…
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Shamsa Rafique 
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