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question 59

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Use the following to answer question :
-Gothic


Definitions:

Sales Variance

Captures the effect of quantity sold holding the mix of products sold constant.

Overhead Variances

The difference between actual overhead costs incurred and the standard or budgeted overhead costs.

Variable Overhead

The indirect expenses that fluctuate with the level of production activity, such as utilities for the manufacturing plant.

Overhead Absorption Rate

Budgeted overhead divided by budgeted volume. Also called overhead application rate.

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