Cheshire, Inc

question 73

Essay

Cheshire, Inc. allocates fixed overhead at a rate of $18 per direct labor hour. This amount is based on 90% of capacity or 3,600 direct labor hours for 6,000 units. During May, Cheshire produced 5,500 units. Budgeted fixed overhead is $66,000, and overhead incurred was $67,000.
Required:
Determine the volume variance for May.

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Definitions:

Acute Stress Disorder

A mental health condition characterized by the development of severe anxiety, dissociation, and other symptoms within a month after exposure to a traumatic event.

Generalized Anxiety Disorder

A psychological disorder characterized by persistent and excessive worry about a number of different things.

Bipolar Disorder

A condition affecting mental health, manifested by intense mood alterations, including periods of mania or hypomania and depressive episodes.

Panic Disorder

A mental health condition characterized by sudden episodes of intense fear or discomfort, known as panic attacks, along with ongoing worry about having more attacks.