Underfoot Products Uses Standard Costing Compute the Fixed Overhead Volume Variance

question 40

Multiple Choice

Underfoot Products uses standard costing. The following information about overhead was generated during May: $\begin{array}{ll}\text { Standard variable overhead rate } & \$ 2 \text { per machine hour } \\\text { Standard fixed overhead rate } & \$ 1 \text { per machine hour } \\\text { Actual variable overhead costs } & \$ 390,000 \\\text { Actual fixed overhead costs } & \$ 175,000 \\\text { Budgeted fixed overhead costs } & \$ 190,000 \\\text { Standard machine hours per unit produced } & 10 \\\text { Good units produced } & 18,000 \\\text { Actual machine hours } & 200,000\end{array}$ Compute the fixed overhead volume variance.

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

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