Livingston Company has developed capacity standards. Information is as follows: Standard cost of the activity capacity acquired $250,000
Standard cost of the activity capacity used 200,000
Standard cost of the actual activity used 220,000
The volume variance is
A) there is no variance.
B) $50,000 unfavorable.
C) $20,000 unfavorable.
D) $30,000 unfavorable.

Question

Quizplus · Accepted Answer

The volume variance is calculated as the difference between the standard cost of the activity capacity acquired and the standard cost of the activity capacity used, which is $250,000 - $200,000 = $50,000 unfavorable.

Livingston Company Has Developed Capacity Standards