(Appendix 10A) Chojnowski Incorporated makes a single product--a cooling coil used in commercial refrigerators. The company has a standard cost system in which it applies overhead to this product based on the standard labor-hours allowed for the actual output of the period. Data concerning the most recent year appear below:

-The fixed overhead budget variance is:
A) $13,000 F
B) $13,000 U
C) $52,195 F
D) $52,195 U

Question

(Appendix 10A) Chojnowski Incorporated makes a single product--a cooling coil used in commercial refrigerators. The company has a standard cost system in which it applies overhead to this product based on the standard labor-hours allowed for the actual output of the period. Data concerning the most recent year appear below:
 
-The fixed overhead budget variance is:
A) $13,000 F 
B) $13,000 U 
C) $52,195 F 
D) $52,195 U

Quizplus · Accepted Answer

Budget variance = Actual fixed overhead - Budgeted fixed overhead
= $312,975 - $325,975 = $13,000 F

(Appendix 10A) Chojnowski Incorporated Makes a Single Product--A Cooling Coil