Budgeted Output for DuCane Small Engines Inc

question 5

Multiple Choice

Budgeted output for DuCane Small Engines Inc. was 20,000 engines during February 2012. Budgeted fixed overhead per output unit was $2.50, and 30,000 engines were actually produced. Actual fixed overhead was allocated at $3.00 per engine. What is the production-volume overhead variance?

• A) $33,500 favourable
• B) $25,000 unfavourable
• C) $30,000 favourable
• D) $30,000 unfavourable
• E) $25,000 favourable

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Definitions:

Tie Rod

A crucial part of the steering mechanism that transmits force from the steering center link or rack gear to the steering knuckle, causing the wheels to turn.

Toe Setting

An alignment parameter that refers to the angle of the wheels in relation to the vehicle's longitudinal axis, affecting handling and tire wear.

Toe-out

A wheel alignment term referring to wheels that are angled outward at the front edges more than the rear edges, a slight adjustment can improve steering response.