Radon Corporation manufactured 37,500 units during March. The following fixed overhead data pertain to March:

What is the fixed overhead production-volume variance?

Question

Radon Corporation manufactured 37,500 units during March. The following fixed overhead data pertain to March:

What is the fixed overhead production-volume variance?

Quizplus · Accepted Answer

Fixed cost per machine hour = $204,000 ÷ 10,200 = $20
Machine hours per unit = 10,200 ÷ 34,000 = 0.3
Fixed cost per unit = $20 × 0.3 = $6.00
Fixed overhead allocated = 37,500 × $6.00 = $225,000.00
Fixed overhead production-volume variance = $204,000 - $225,000.00 =$21,000.00 F

Radon Corporation Manufactured 37,500 Units During March