(Appendix 10A) Zotta Enterprises uses standard costing and applies manufacturing overhead cost to products on the basis of standard direct labor-hours (DLHs). Budgeted and actual data relating to manufacturing overhead for last year appear below:

-The budgeted fixed manufacturing overhead cost was:
A) $24,000
B) $38,900
C) $40,200
D) $37,600

Question

(Appendix 10A) Zotta Enterprises uses standard costing and applies manufacturing overhead cost to products on the basis of standard direct labor-hours (DLHs). Budgeted and actual data relating to manufacturing overhead for last year appear below:
 
-The budgeted fixed manufacturing overhead cost was:
A) $24,000 
B) $38,900 
C) $40,200 
D) $37,600

Quizplus · Accepted Answer

Budget variance = Actual fixed overhead - Budgeted fixed overhead
$1,300 U = $38,900 - Budgeted fixed overhead
$1,300 = $38,900 - Budgeted fixed overhead
Budgeted fixed overhead = $38,900 - $1,300
Budgeted fixed overhead = $37,600

(Appendix 10A) Zotta Enterprises Uses Standard Costing and Applies Manufacturing