King Company Estimated That It Would Operate Its Manufacturing Facilities

question 22

Multiple Choice

King Company estimated that it would operate its manufacturing facilities at 800,000 direct labour hours for the year, which served as the denominator activity in the predetermined overhead rate. The total budgeted manufacturing overhead for the year was $2,000,000, of which $1,600,000 was variable and $400,000 was fixed. The standard variable overhead rate was $2 per direct labour hour. The standard direct labour time was 3 direct labour hours per unit. The actual results for the year are presented below:
$\begin{array} { | l | r | } \hline \text { Actual Finished Units } & 250,000 \\\hline \text { Actual Direct Labour Hours } & 764,000 \\\hline \text { Actual Variable Overhead } & \$ 1,610,000 \\\hline \text { Actual Fixed Overhead } & \$ 392,000 \\\hline\end{array}$

-What was the fixed overhead budget variance for the year?

• A) $8,000 favourable.
• B) $10,000 unfavourable.
• C) $17,000 unfavourable.
• D) $74,000 favourable.

Understand the role and importance of product packaging and labeling.

Comprehend the significance and types of services associated with products.

Grasp the concepts of product types based on consumer buying behavior.

Understand the importance of brand equity, awareness, and associations in marketing.

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Definitions:

George McClellan

A major general during the American Civil War, known for his cautious tactics and contentious relationship with President Abraham Lincoln.

Zealous Commitment

An intense and passionate dedication to a cause, belief, or goal.

Decisive Action

A firm, resolute action taken to solve a problem or achieve a goal, often characterized by its effectiveness in bringing about a significant change or resolving a critical situation.

Confederate Soldiers

Individuals who served in the military forces of the Confederate States of America during the American Civil War.