fixed overheads volume

This topic has 3 replies, 2 voices, and was last updated 1 year ago by John Moffat.

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June 1, 2014 at 1:51 am #172239
josy87
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Hello Sir
please I need help with this question,
QR has budgeted to produce 4000U in January. Actual production was 3 700 units with fixed production overheads of $ 10,300. The standard fixed overhead cost per unit was 1.5 hours at $2.4 per hour. 5800 actual production hours were worked.
find the fixed overhead volume variance
A $1080 FAV

B $480 Fav

C $480 Adv

D $1080 adv

I got D but the right answer in the book is A. Im confused.
June 1, 2014 at 12:43 pm #172324
John Moffat
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D is correct!

(I don’t know which book you found this is, but A is the wrong answer)
November 21, 2024 at 2:03 pm #713404
muskanzohra
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Can u please explain the same question bit more not just answer like how to solve it
November 22, 2024 at 10:23 am #713426
John Moffat
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The poster had solved in correctly which is why I didn’t need to show the workings.

They produced 300 units less than budgeted. Therefore the volume variance is 300 x 1.5 hours x $2.40 = $1,080 adverse

Have you watched the free lectures on this?
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