Teall Corporation has a standard cost system in which it applies manufacturing overhead to products on the basis of standard machine-hours (MHs). The company has provided the following data for the most recent month: What was the fixed manufacturing overhead budget variance for the month?
A) $4,000 Unfavorable
B) $4,000 Favorable
C) $570 Favorable
D) $570 Unfavorable

Question

Teall Corporation has a standard cost system in which it applies manufacturing overhead to products on the basis of standard machine-hours (MHs). The company has provided the following data for the most recent month:  What was the fixed manufacturing overhead budget variance for the month?
A) $4,000 Unfavorable 
B) $4,000 Favorable 
C) $570 Favorable 
D) $570 Unfavorable

Quizplus · Accepted Answer

Budget variance = Actual fixed overhead − Budgeted fixed overhead cost
= $54,000 − $50,000
= $4,000 U

Teall Corporation Has a Standard Cost System in Which It