Vandall Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During April, the company budgeted for 7,300 units, but its actual level of activity was 7,340 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for April:
-The spending variance for manufacturing overhead in April would be closest to:
A) $1,600 U
B) $1,648 F
C) $1,600 F
D) $1,648 U

Question

Vandall Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During April, the company budgeted for 7,300 units, but its actual level of activity was 7,340 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for April: 
-The spending variance for manufacturing overhead in April would be closest to:
A) $1,600 U 
B) $1,648 F 
C) $1,600 F 
D) $1,648 U

Quizplus · Accepted Answer

The spending variance is calculated as the difference between the actual overhead costs and the budgeted overhead costs. The closest value to the calculated variance is $1,600 unfavorable (U).

Vandall Corporation Manufactures and Sells a Single Product