Bargain Boys Company, Which Applies Overhead to Production on the Basis

question 45

Multiple Choice

Bargain Boys Company, which applies overhead to production on the basis of machine hours, reported the following data for the period just ended: Actual units produced: 14,800
Actual fixed overhead incurred: $791,000
Standard fixed overhead rate: $13 per hour
Budgeted fixed overhead: $780,000
Planned level of machine-hour activity: 60,000
If Bargain Boys estimates four hours to manufacture a completed unit, the fixed-overhead volume variance would be:

• A)$10,400 favourable.
• B)$10,400 unfavourable.
• C)$11,000 favourable.
• D)$11,000 unfavourable.
• E)$66,600 favourable.

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Definitions:

Conflict

A serious disagreement or argument, typically a prolonged one.

Caught

Successfully captured or apprehended, especially in the context of pursuing someone or something that is elusive.

Field Goal

A score in various sports made by kicking, hitting, or shooting the ball through a goal or over a crossbar.

Frustration

A feeling of dissatisfaction or annoyance that arises when a person's progress towards a goal is blocked or impeded.