Temores Corporation applies manufacturing overhead to products on the basis of standard machine-hours.The company's predetermined overhead rate for fixed manufacturing overhead is $1.50 per machine-hour and the denominator level of activity is 5,600 machine-hours.In the most recent month,the total actual fixed manufacturing overhead was $8,510 and the company actually worked 5,840 machine-hours during the month.The standard hours allowed for the actual output of the month totaled 5,980 machine-hours.What was the overall fixed manufacturing overhead volume variance for the month?
A)$360 favorable
B)$360 unfavorable
C)$570 favorable
D)$210 favorable

Question

Quizplus · Accepted Answer

Volume variance = Budgeted fixed overhead cost - Fixed overhead applied to work in process
= (5,600 machine-hours F1F1F1S1F1F1F10 $1.50 per machine-hour)- (5,980 machine-hours F1F1F1S1F1F1F10 $1.50 per machine-hour)
= $8,400 - $8,970 = $570 F

Temores Corporation Applies Manufacturing Overhead to Products on the Basis