The Standard Fixed Factory Overhead Rate Is Based on 100

question 134

Multiple Choice

The standard fixed factory overhead rate is based on 100% capacity of 50,000 direct labor hours.The standard costs and the actual costs for factory overhead for the production of 8,000 units during the current month were as follows: $$\begin{array} { l l l } \text { Standard: } & 40,000 \text { hours at } \$ 3 & \$ 120,000 \\\text { Actual: } & \text { Factory overhead } & \\& ( 41,000 \text { direct labor hours) } & 131,200\end{array}$$ ? If there was a $9,000 unfavorable volume variance for December, what is the standard fixed factory overhead cost rate?

• A) $1.00
• B) $0.90
• C) $2.40
• D) $0.80

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