The following information is available from the Fitzgerald Company: $\begin{array}{ll}
\text { Actual OH } & \$ 15,000 \
\text { Fixed OH expenses, actual } & \$ 7,200 \
\text { Fixed OH expenses, budgeted } & \$ 7,000 \
\text { Actual hours } & 3,500 \
\text { Standard hours } & 3,800 \
\text { Variable OH rate per DLH } & \$ 2.50
\end{array}$ Assuming that Fitzgerald uses a three-way analysis of overhead variances,what is the overhead spending variance?
A)$750 F
B)$750 U
C)$950 F
D)$1,500 U

Question

Quizplus · Accepted Answer

The overhead spending variance is the difference between the actual overhead costs and the budgeted overhead costs. In this case, the actual overhead costs are $15,000 and the budgeted overhead costs are $7,000, so the overhead spending variance is $15,000 - $7,000 = $750 F.

The Following Information Is Available from the Fitzgerald Company Assuming That Fitzgerald Uses a Three-Way Analysis of Overhead Variances,what