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:
-What was the fixed manufacturing overhead volume variance for the period to the nearest dollar?
A)$486 F
B)$1,105 U
C)$619 U
D)$612 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: 
-What was the fixed manufacturing overhead volume variance for the period to the nearest dollar?
A)$486 F 
B)$1,105 U 
C)$619 U 
D)$612 U

Quizplus · Accepted Answer

Volume variance = Budgeted fixed overhead cost - Fixed overhead applied to work in process
= $86,190 - (7,744 MHs F1F1F1S1F1F1F10 $11.05 per MH)
= $86,190 - $85,571 = $619 U

A Manufacturer of Playground Equipment Uses a Standard Costing System