Dill has a fixed overhead spending variance of $3,900 unfavorable.During July,Dill budgeted production of 4,500 units,it actually produced 4,700 units,and it actually spent $71,400 on fixed overhead.How much was budgeted fixed overhead?
A)$67,500
B)$68,362
C)$71,400
D)$75,300

Question

Quizplus · Accepted Answer

The budgeted fixed overhead can be calculated by subtracting the fixed overhead spending variance from the actual fixed overhead spent. Since the variance is unfavorable, it means the actual spending was more than the budgeted amount. Therefore, budgeted fixed overhead = Actual fixed overhead - Fixed overhead spending variance = $71,400 - $3,900 = $67,500.

Dill Has a Fixed Overhead Spending Variance of $3,900 Unfavorable