An Alternative Vertical Approach to Analyzing Overhead Variances.
Academy of Accounting and Financial Studies Journal 1997, Jan, 1, 1
Academy of Accounting and Financial Studies Journal
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INTRODUCTION Variance analysis has traditionally been among the more difficult topics for cost and managerial students to comprehend. Various methods have been suggested for presenting this material in a manner that will simplify calculations and facilitate an understanding of the resulting variances. Among these methods the most commonly used are the formula approach and the horizontal diagram approach, both of which are illustrated in many textbooks. Alternative approaches include a "common sense" approach (Chow, 1988), a graphic approach (Martin & Laughlin, 1988), and a vertical approach (Smith, 1991). While the techniques may vary, all of the methods attempt to simplify the calculations of the variances and promote an understanding and appreciation of the meaning of the resultant numbers.
- Category: Business & Personal Finance
- Published: 01 January 1997
- Publisher: The DreamCatchers Group, LLC
- Print Length: 9 Pages
- Language: English