Gina Production Company Uses a Standard Costing System

question 62

Multiple Choice

Gina Production Company uses a standard costing system. The following information pertains to 2011: The overhead rate is based on an activity level of 10,000 hours. Standard cost data for 5,000 units is as follows:
What is the fixed overhead volume variance for Gina Production Company?

• A) $1,350 F
• B) $3,600 F
• C) $4,125 U
• D) $1,350 U

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Definitions:

Strategic Initiatives

Planned actions designed to achieve long-term goals that significantly impact an organization's direction and success.

Value Chain

A model that describes the full range of activities needed to create a product or service, from inception to delivery to the end user.

Leading Indicators

Economic or financial variables that predict future trends and changes in the economy or markets before they occur.

Lagging Indicators

Metrics that follow an event, used to confirm patterns or trends, typically economic, after they have begun to manifest.