Luke\'s Football Manufacturing Company reported: Actual fixed overhead $400,000

Question

Luke's Football Manufacturing Company reported:
   Actual fixed overhead   $400,000
   Fixed manufacturing overhead spending variance   $10,000 favorable
   Fixed manufacturing production-volume variance   $15,000 unfavorable

To isolate these variances at the end of the accounting period, John would debit Fixed Manufacturing Overhead Allocated for ________.
A) $390,000
B) $395,000
C) $400,000
D) $405,000

I know the answer is B: 395000, but I think D is correct because the FIXED cost changing favorable/unfavorable. Am I correct??

Explanation / Answer

B) $395,000   Fixed Manufacturing Overhead Allocated = $400,000 + 10,000 -15,000 = $395,000

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