Tantanka Manufacturing Corporation Uses a Standard Cost System with Machine-Hours

question 91

Multiple Choice

Tantanka Manufacturing Corporation uses a standard cost system with machine-hours as the activity base for overhead. The following information relates to production for last year: The standard machine-hours allowed for actual output during the year were 7,600. The actual machine-hours incurred were 7,500.
What was Tantanka's fixed manufacturing overhead volume variance?

• A) $5,700 Unfavorable
• B) $14,440 Unfavorable
• C) $28,500 Favorable
• D) $34,200 Unfavorable

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Definitions:

Days Sales Outstanding (DSO)

A measure of the number of days that it takes to collect on accounts receivable.

Accounts Receivable

Money owed to the company for goods or services provided and billed to a customer.

Accounts Payable

Money owed by a business to its suppliers.

Cash Inflow

The movement of money into a business or project, contributing to its financial resources.