Asked by Analise Johnson on May 13, 2024
Verified
The fixed manufacturing overhead volume variance for the period is closest to:
A) $1,240 U
B) $496 F
C) $1,736 F
D) $516 F
Volume Variance
The difference between the planned level of production volume and the actual production volume, often relating to overhead costs.
- Analyze how changes in volume affect cost management strategies.
Verified Answer
AA
Arlene A. LaquianMay 17, 2024
Final Answer :
B
Explanation :
Fixed component of the predetermined overhead rate = $17,360 ÷ 1,400 hours = $12.40 per hour
Volume variance = Budgeted fixed overhead cost - Fixed overhead applied to work in process
= $17,360 - (1,440 hours × $12.40 per hour)
= $17,360 - $17,856
= $496 F
Reference: APP10A-Ref3
(Appendix 9A)Keeran Corporation estimates that its variable manufacturing overhead is $5.20 per machine-hour and its fixed manufacturing overhead is $242,048 per period.
Volume variance = Budgeted fixed overhead cost - Fixed overhead applied to work in process
= $17,360 - (1,440 hours × $12.40 per hour)
= $17,360 - $17,856
= $496 F
Reference: APP10A-Ref3
(Appendix 9A)Keeran Corporation estimates that its variable manufacturing overhead is $5.20 per machine-hour and its fixed manufacturing overhead is $242,048 per period.
Learning Objectives
- Analyze how changes in volume affect cost management strategies.