Radon Corporation manufactured 25,000 grooming kits for horses during March.The following fixed overhead data pertain to March: $\begin{array}{lrr}&\text { Actual }&\text { Static Budget }\
\text { Production } & 33,000 \text { units } & 30,000 \text { units } \
\text { Machine-hours } & 6,100 \text { hours } & 6,000 \text { hours } \
\text { Fixed overhead costs for March } & \$ 153,000 & \$ 144,000
\end{array}$
-What is the fixed overhead spending variance?

Question

Quizplus · Accepted Answer

The fixed overhead spending variance measures the difference between the actual fixed overhead spending and the budgeted fixed overhead spending. It is calculated as Actual Fixed Overhead – Budgeted Fixed Overhead. In this case, the variance is $9,000 unfavorable because the actual fixed overhead spending is $63,000 ($54,000 + $9,000) and the budgeted fixed overhead spending is $54,000.

Radon Corporation Manufactured 25,000 Grooming Kits for Horses During March