The Standard Variable Overhead Cost Rate for the Gordon Company

question 14

Multiple Choice

The standard variable overhead cost rate for the Gordon Company is $11.25 per unit. Budgeted fixed overhead cost is $50,000. The company budgeted 5,000 units for the current period and actually produced 4,150 finished units. What is the fixed overhead volume variance? Assume the allocation base for fixed overhead costs is the number of units expected to be produced.

• A)$3,780 favorable
• B)$2,100 unfavorable
• C)$2,100 favorable
• D)$3,780 unfavorable

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Definitions:

Federal Mediation

The process by which a neutral third party, authorized by the government, intervenes in labor disputes to help involved parties reach an agreement.

Picketing Actions

A form of labor protest in which striking workers stand outside their place of work, often holding signs, to express grievances and deter others from entering the premises.

Mediation

A conflict resolution process involving a neutral third-party who helps disputing parties find a mutually acceptable solution without making decisions for them.

Railway Labor Act

A U.S. federal law originally passed in 1926 that governs labor relations in the railway and airline industries.