Use the Following Information for the Next 6 Questions

question 26

Multiple Choice

Use the following information for the next 6 questions.
Hyteck, Inc. is a capital intensive firm. Indirect costs make up nearly 70% of the product costs. The company has no direct material costs because customers provide the direct materials used for each job. To plan and control such costs, the firm employs flexible budgets and standard costs. Overhead rates, based on direct labor hours, are derived from the master budget.
-The fixed overhead production volume variance was

• A) $9,000 U
• B) $2,000 F
• C) $7,000 U
• D) $2,800 U

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Definitions:

Black-Scholes Model

A mathematical model used for pricing European-style options, estimating the variation over time of financial instruments.

Call Option

A deal in the financial industry that bestows upon the buyer the latitude, but exempts them from the necessity, to acquire stocks, bonds, commodities, or other assets at a price fixed in advance, within a predetermined time frame.

Warrants

Financial instruments that give the holder the right, but not the obligation, to buy a company's stock at a specific price before a specified date.

Publicly Traded Bonds

Bonds issued by companies or governments that are available for purchase and sale on public stock exchanges.