A manufacturer of playground equipment uses a standard costing system in which standard machine-hours (MHs)is the measure of activity.Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: The fixed manufacturing overhead budget variance for the period is closest to:
A)$4,470 U
B)$950 U
C)$2,790 F
D)$1,381 U

Question

A manufacturer of playground equipment uses a standard costing system in which standard machine-hours (MHs)is the measure of activity.Data from the company's flexible budget for manufacturing overhead are given below:  The following data pertain to operations for the most recent period:  The fixed manufacturing overhead budget variance for the period is closest to:
A)$4,470 U 
B)$950 U 
C)$2,790 F 
D)$1,381 U

Quizplus · Accepted Answer

Budget variance = Actual fixed overhead - Budgeted fixed overhead cost
= $41,600 - $40,650 = $950 U

A Manufacturer of Playground Equipment Uses a Standard Costing System