Croissant Company's Standard Fixed Overhead Cost Is $6 Per Direct

question 65

Multiple Choice

Croissant Company's standard fixed overhead cost is $6 per direct labor hour based on budgeted fixed costs of $600,000. The standard allows 1 direct labor hour per unit. During 2016, Croissant produced 110,000 units of product, incurred $630,000 of fixed overhead costs, and recorded 212,000 actual hours of direct labor.
What is Croissant's fixed overhead volume variance for 2016?

• A) $60,000 (U)
• B) $24,000 (F)
• C) $36,000 (U)
• D) $60,000 (F)

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Definitions:

Distribution Density

The measure of how widely and closely a product or service is distributed and available to consumers within a market.

Geographical Area

A specific physical region or space defined by natural or artificial boundaries.

Administered Vertical Marketing System

A coordinated marketing channel where a single member coordinates activities, without formal agreements, to increase efficiency and effectiveness.

Contractual Agreements

Legally binding contracts or understandings between two or more parties outlining the terms and conditions of a business arrangement.