Steinhagen Corporation Applies Manufacturing Overhead to Products on the Basis

question 52

Multiple Choice

Steinhagen Corporation applies manufacturing overhead to products on the basis of standard machine-hours. Budgeted and actual overhead costs for the most recent month appear below: The company based its original budget on 2,600 machine-hours. The company actually worked 2,790 machine-hours during the month. The standard hours allowed for the actual output of the month totaled 2,960 machine-hours. What was the overall fixed manufacturing overhead volume variance for the month?

• A)$5,148 Favorable
• B)$5,148 Unfavorable
• C)$2,717 Favorable
• D)$2,717 Unfavorable

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Definitions:

Significance Level

The risk set by the researcher for rejecting a null hypothesis when it is true.

Obtained Value

The value that results from the application of a statistical test.

Fisher's Exact Test

A statistical significance test used for small sample sizes, analyzing the association between two categorical variables.

2 × 2 Table

A contingency table with two rows and two columns used to display the frequency distribution of variables' combinations.