Nexus Industries Uses a Standard Costing System to Apply Manufacturing

question 10

Multiple Choice

Nexus Industries uses a standard costing system to apply manufacturing costs to its production process. In May, Nexus anticipated producing 2050 units with fixed manufacturing overhead costs allocated at $8.4 per direct labor hour with a standard of 2.5 direct labor hours per unit. In May, actual production was 3300 units and actual fixed manufacturing overhead costs were $29,000. What was Nexus' fixed manufacturing overhead budget variance in May?

• A)$14,050 favorable
• B)$14,050 unfavorable
• C)$26,250 favorable
• D)$26,250 unfavorable

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Definitions:

Burial Compression

The process by which sediment layers accumulate over time, exerting pressure on lower layers, leading to compaction and rock formation.

Fluid Pressure

The pressure exerted by a fluid, either a liquid or a gas, which plays a critical role in various geological processes like oil migration and faulting.

Compression

The process or result of applying force to something that causes it to become squeezed or compacted, often leading to a decrease in volume.

Tension

A force that stretches something, making it tight or the state of being stretched tight.