Kano Textiles Limited operates a standard absorption costing system. The following data relates to June 2024: Budgeted fixed overheads ₦4,500,000; Budgeted hours 15,000; Actual fixed overheads ₦4,800,000; Actual hours worked 14,200; Standard hours for actual output 14,500. What is the Fixed Overhead Expenditure (Budget) Variance?

Fixed Overhead Expenditure Variance = Budgeted Fixed Overheads – Actual Fixed Overheads = ₦4,500,000 – ₦4,800,000 = ₦300,000 Adverse. This variance measures the difference between what was budgeted to be spent on fixed overheads and what was actually spent, regardless of output levels. It is adverse because actual spending exceeded the budget by ₦300,000.