The Following Information Was Compiled by Gidget Incorporated Assume the Cost-Allocation Base for Overhead Costs Is Units of l

question 41

Multiple Choice

The following information was compiled by Gidget Incorporated:
$\begin{array} { l } \text {Expected volume of production }&50,000 \text { units }\\ \text {Actual volume of production }&47,000 \text { units }\\ \text { Budgeted fixed overhead costs (for 50,000 budgeted units) }&\$200,000 \\ \text {Actual fixed overhead costs }&\$220,000 \\ \text { Actual variable overhead costs}&\$790,000 \\ \text { Budgeted variable overhead costs (for 50,000 bud geted units) }&\$ 855,000\\\end{array}$

Assume the cost-allocation base for overhead costs is units of production.What is the production volume variance?

• A) $6,000 Unfavorable
• B) $12,000 Unfavorable
• C) $20,000 Favorable
• D) $20,000 Unfavorable

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