Question

Rodarta Corporation applies manufacturing overhead to products on the basis of standard machine-hours. The company's predetermined overhead rate for fixed manufacturing overhead is $5.10 per machine-hour and the denominator level of activity is 5,300 machine-hours. In the most recent month, the total actual fixed manufacturing overhead was $27,230 and the company actually worked 5,230 machine-hours during the month. The standard hours allowed for the actual output of the month totaled 5,250 machine-hours. What was the overall fixed manufacturing overhead volume variance for the mon

Answer 1

Answer:

$357 Unfavorable

Explanation:

Fixed manufacturing overhead volume variance identifies the amount by which actual production differs from budgeted production.

Fixed manufacturing overhead volume variance = Actual Output at Budgeted rate - Budgeted Fixed Overheads

                                                                  = (5,230 × $5.10) - ($5.10 × 5,300)

                                                                   = $26,673 - $27,030

                                                                   = $357 Unfavorable