A Manufacturing Company Has a Standard Costing System Based on Direct

question 64

Multiple Choice

A manufacturing company has a standard costing system based on direct labour-hours (DLHs) as the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below: $\begin{array}{lrr} \text { Denominator level of activity } &3,700&\text { DLHs }\\ \text { Overhead costs at the denominator activity level: } &\\ \text { Variable overhead cost } &£ 28,490\\ \text { Fixed owerhead cost } &£ 47,545\\ \text { The following data pertain to operations for the most recent period:} &\\ \text { Actual hours } &3,900&\text { DLHs }\\ \text { Standard hours 3,900allowed for the actual output } &3,850&\text { DLHs }\\ \text { Actual total variable overhead cost } &£ 29,445\\ \text {Actual total fixed overhead cost } &£47,995 \\\end{array}$


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What was the fixed overhead volume variance for the period to the nearest pound

• A)£1,870 F
• B)£1,928 F
• C)£643 U
• D)£2,570 F

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Definitions:

Unpredictable Pattern

A sequence of events or behaviors that does not follow a discernible or consistent pattern, making it difficult to anticipate future occurrences.

Homeostasis

The self-regulating process by which biological systems maintain stability while adjusting to changing external conditions.

Equilibrium

A state of balance or stability within a system, achieved when competing forces or influences are equal or in correct proportion.