Robert Inc. uses the standard costing method. The company\'s main product is a f

Question

Robert Inc. uses the standard costing method. The company's main product is a fine-quality headphones that normally takes 0.5 hour to produce. Normal annual capacity is 5,000 direct labor hours, and budgeted fixed overhead costs for the year were $8,750. During the year, the company produced and sold 5,800 units. Actual fixed overhead costs were $6,000.

Using the information provided for Robert Inc, compute the fixed overhead volume variance.

$925 (U)

$5,800 (U)

$3,675 (U)

$2,750 (F)

$925 (U)

$5,800 (U)

$3,675 (U)

$2,750 (F)

Explanation / Answer

c. $3,675 (U) BudgetedFixed Overheads                    8,750.00 No of hours                    5,000.00 Fixed O/H per hour                            1.75 Absorbed Fixed O/H = 5800*.5*1.75                    5,075.00 Fixed O/H Vol Var = Absorbed - Budgeted Fixed O/H Vol Var = 5075 - 8750 Fixed O/H Vol Var = 3,675 U

Related Questions

Navigate

• Browse (All)
• Browse R
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.