Mauve Company uses a standard cost system in which it applies manufacturing overhead to units of product on the basis of standard direct labor-hours (DLHs).The following data pertain to last month: The fixed manufacturing overhead budget variance is:
A)$400 U
B)$500 F
C)$300 F
D)$300 U

Question

Mauve Company uses a standard cost system in which it applies manufacturing overhead to units of product on the basis of standard direct labor-hours (DLHs).The following data pertain to last month:  The fixed manufacturing overhead budget variance is:
A)$400 U 
B)$500 F 
C)$300 F 
D)$300 U

Quizplus · Accepted Answer

Budget variance = Actual fixed manufacturing overhead cost - Budgeted fixed manufacturing overhead cost = $10,400 - $10,000 = $400 U

Mauve Company Uses a Standard Cost System in Which It