# CMA Study Group

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## Question

• #### 1.  Question

Posted 22 days ago
A company compiled the following information: Actual factory overhead \$22,500 Fixed overhead expenses, actual \$10,800 Fixed overhead expenses, budgeted \$10,500 Actual hours 5,250 Standard hours 5,700 Variable overhead rate per DLH \$3.80
What is the spending variance assuming the company uses a three-way analysis of overhead?
 A. \$7,950 favorable. B. \$9,660 unfavorable. C. \$8,250 favorable. D. \$7,950 unfavorable.Can anyone solve it and elaborate in details so it will be easy to understand. Even getting all concept of analysis but not able to get actual answer. Regards, Shreshth

• #### 2.  RE: Question

Posted 21 days ago
22500-10800=11700
11700/5250=2.22857 DLH
(2.22857-3.8)*5250=8250 favorable because the actual cost less than standard

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Hebah Masoud
Supervisor
Amman
Jordan
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• #### 3.  RE: Question

Posted 21 days ago
3 way analysis spending variance = Variable + Fixed OH variance
8250 as shown above  - 300 OH variance since fixed OH cost driver wasnt given assume that the difference between the actual and fixed is the spending variance for fixed OH
8250 F - 300 U = 7950 F

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Mohammed Al Dibes
Other
Edmonton AB