The following budget data pertain to the Machining Department of Yolkenverst Co.:The company prepared the budget at 85% of the maximum capacity level. The department uses machine hours as the basis for applying standard factory overhead costs to production.
During the year the Machining Department produced 50,000 units, consuming 127,500 machine hours and incurring $433,500 of fixed overhead. For the current year the department has a fixed overhead production volume variance, rounded to the nearest whole dollar, of:
A) $0.
B) $3,400 unfavorable.
C) $3,600 unfavorable.
D) $7,000 unfavorable.
E) $8,500 unfavorable.

Question

The following budget data pertain to the Machining Department of Yolkenverst Co.:The company prepared the budget at 85% of the maximum capacity level. The department uses machine hours as the basis for applying standard factory overhead costs to production.
During the year the Machining Department produced 50,000 units, consuming 127,500 machine hours and incurring $433,500 of fixed overhead. For the current year the department has a fixed overhead production volume variance, rounded to the nearest whole dollar, of:
A) $0. 
B) $3,400 unfavorable. 
C) $3,600 unfavorable. 
D) $7,000 unfavorable. 
E) $8,500 unfavorable.

Quizplus · Accepted Answer

The Answer of The following budget data pertain to the Machining Department of Yolkenverst Co.:The company prepared the budget at 85% of the maximum capacity level. The department uses machine hours as the basis for applying standard factory overhead costs to production.
During the year the Machining Department produced 50,000 units, consuming 127,500 machine hours and incurring $433,500 of fixed overhead. For the current year the department has a fixed overhead production volume variance, rounded to the nearest whole dollar, of:
A) $0. 
B) $3,400 unfavorable. 
C) $3,600 unfavorable. 
D) $7,000 unfavorable. 
E) $8,500 unfavorable.

The Following Budget Data Pertain to the Machining Department of Yolkenverst