Underfoot Products Uses Standard Costing Compute the Fixed Overhead Budget Variance

question 21

Multiple Choice

Underfoot Products uses standard costing.The following information about overhead was generated during May: $$\begin{array} { l l } \text { Standard variable dverhead rate } & \$ 2 \text { per machine how } \\\text { Standard Eixed overhead rate } & \$ \text { per machine hour } \\\text { Actual variable cverhead costs } & \$ 390,000 \\\text { Actual fixed overhead costs } & \$ 175,000 \\\text { Budgeted fixed cverhead costs } & \$ 190,000 \\\text { Standard machine hours per unit produced } & 10 \\\text { Good units produced } & 18,000 \\\text { Actual machine hours } & 200,000\end{array}$$
Compute the fixed overhead budget variance.

• A) $5,000 (F)
• B) $5,000 (U)
• C) $10,000 (F)
• D) $15,000 (F)

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Definitions:

Jnd

The just noticeable difference, the minimal change in stimulus intensity required to detect a difference between two stimuli.

Constant

A situation or state of affairs that remains unchanged over a period of time.

Psychophysics

The scientific study of the relationship between physical stimuli and the sensations and perceptions they produce.

Sensory Experiences

The subjective experiences generated through the reception and interpretation of sensory information by the brain.