Budgeted Overhead for Haft Inc

question 8

Multiple Choice

Budgeted overhead for Haft Inc. at normal capacity of 60000 direct labor hours is $3 per hour variable and $2 per hour fixed. In May $310000 of overhead was incurred in working 63000 hours when 64000 standard hours were allowed.
- The overhead volume variance is

• A) $8000 favorable.
• B) $11000 favorable.
• C) $5000 favorable.
• D) $10000 favorable.

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Definitions:

Bonds

Fixed income investments representing a loan made by an investor to a borrower, typically corporate or governmental, that pays back with interest.

Par Value

The stated value or face amount of a bond, stock share, or coupon as declared by the issuing entity.

Journal Entry

A record in the books of accounts that notes the details of a financial transaction.

Semiannual Interest

Interest that is calculated and paid twice a year, often used in bond and loan agreements.