Avon Co.has a fixed overhead spending variance of $2,800 favorable.During February,2,500 units were budgeted to be produced,2,400 units were actually produced,and $75,000 was budgeted for fixed overhead.How much was actually spent on fixed overhead?
A)$72,000
B)$72,200
C)$75,000
D)$77,800

Question

Quizplus · Accepted Answer

To calculate the fixed overhead spending variance, we need to compare the budgeted fixed overhead with the actual fixed overhead.

Budgeted fixed overhead = $75,000 
Budgeted fixed overhead per unit = $75,000 / 2,500 = $30 
Actual fixed overhead = Budgeted fixed overhead - Fixed overhead spending variance 
Actual fixed overhead = $75,000 - $2,800 = $72,200

Therefore, the answer is B, $72,200.

Avon CoHas a Fixed Overhead Spending Variance of $2,800 Favorable