Fixed overhead was budgeted at $85,000, and 10,000 direct labour hours were budgeted. Suppose the fixed overhead volume variance was $5,000 unfavourable and the fixed overhead spending variance was $1,200 favourable. How much fixed overhead was applied?
A) $80,000
B) $82,000
C) $82,800
D) $90,000

Question

Quizplus · Accepted Answer

The fixed overhead applied is calculated by subtracting the volume variance from the budgeted fixed overhead: $85,000 - $5,000 = $80,000.

Fixed Overhead Was Budgeted at $85,000, and 10,000 Direct Labour