Megan, Inc

question 20

Multiple Choice

Megan, Inc. uses the following standard costs per unit for one of its products: Direct labor (2.0 hrs. @ $5.00/hr.) = $10.00; overhead (2.0 hrs. @ $2.50/hr.) = $5.00. The flexible budget for overhead is $120,000 plus $1.00 per direct labor hour (DLH) . Actual data for the past month show total overhead costs of $225,000, total fixed overhead of $123,000, 85,000 hours worked, and 40,000 units produced.

The variable overhead spending variance for the past month for Megan, Inc., to the nearest whole dollar, was:

• A) $0.
• B) $3,000 unfavorable.
• C) $5,000 unfavorable.
• D) $17,000 unfavorable.
• E) Cannot be determined without additional information.

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Definitions:

Attributional Style

A psychological characteristic that describes how individuals explain the causes of events, both positive and negative, in their lives.

Spouse's Behaviors

Actions or reactions exhibited by one's partner or significant other in the context of a marital or similar intimate relationship.

Sunk Costs

Sunk costs refer to expenses that have been incurred and cannot be recovered, often influencing future decision-making in a way that irrationality values these past investments over current and future considerations.

Dating

The process of two people engaging in activities together to explore romantic or sexual interest.