Alumni Manufacturing Company Has the Following Information Pertaining to a Normal

question 56

Multiple Choice

Alumni Manufacturing Company has the following information pertaining to a normal monthly activity of 10,000 units: Standard factory overhead rates are based on a normal monthly volume of one standard direct hour per unit. Standard factory overhead rates per direct labor hour are:
$\begin{array} { l l l } \text { Fixed } & \$ 6.00 & \\ \text { Variable } & 10.00 & \$ 16.00 \\\\\text { Units actually produced in current month } & 9,000 \text { units } \\\text { Actual factory overhead costs incurred } & \\\text { (includes } \$ 70,000 \text { fixed) } & \$ 156,000 \\\text { Actual direct labor hours } & 9,000 \text { hours }\end{array}$

What is the fixed overhead spending variance for Alumni?

• A)$10,000 (U)
• B)$6,000 (U)
• C)$4,000 (F)
• D)$-0-

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