Formidable Company Collected the Following Information: Standard Costs Per Unit

question 77

Multiple Choice

Formidable Company collected the following information: Standard costs per unit:
Variable overhead 4 machine hours @ $6 per machine hour
Fixed overhead 4 machine hours @ $10 per machine hour
Actual output 20,000 units
Denominator (normal capacity) output 21,000 units
Actual machine hours 79,000 machine hours
Actual variable overhead cost $540,000
Actual fixed overhead cost $810,000
Using the two variance method, what is the budget variance?

• A) $70,000 (U)
• B) $30,000 (F)
• C) $30,000 (U)
• D) $70,000 (F)

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Definitions:

Cultural Differences

The variations in beliefs, behaviors, norms, and values within and between groups of people from different backgrounds.

North American Meanings

The interpretations or connotations of words, phrases, or concepts specific to the North American context, often differing from those in other regions.

Culture Shock

The feeling of disorientation and discomfort that can occur when one is exposed to a foreign culture or radically different environment.

Disorientation

A state of confusion regarding time, place, or identity, often affecting individuals under stress or in unfamiliar situations.