Stopyra Incorporated makes a single product-a cooling coil used in commercial refrigerators. The company has a standard cost system in which it applies overhead to this product based on the standard labor-hours allowed for the actual output of the period. Data concerning the most recent year appear below: The fixed overhead budget variance is:
A) $2,856 U
B) $15,000 F
C) $2,856 F
D) $15,000 U

Question

Stopyra Incorporated makes a single product-a cooling coil used in commercial refrigerators. The company has a standard cost system in which it applies overhead to this product based on the standard labor-hours allowed for the actual output of the period. Data concerning the most recent year appear below:  The fixed overhead budget variance is:
A) $2,856 U 
B) $15,000 F 
C) $2,856 F 
D) $15,000 U

Quizplus · Accepted Answer

Budget variance = Actual fixed overhead − Budgeted fixed overhead
= $74,280 − $89,280 = $15,000 F

Stopyra Incorporated Makes a Single Product-A Cooling Coil Used in Commercial